Navigating Digital Inequality: Examining Factors Affecting Rural Customers’ Internet Banking Adoption in Post-COVID Bangladesh

Abstract

As the world continues to navigate the new normal brought about by the COVID-19 pandemic, one issue that has come to the forefront is digital inequality. In Bangladesh, where a significant portion of the population resides in rural areas, the adoption of internet banking has been hindered by various factors. However, understanding these factors is crucial, especially now that digital transactions have become more important. This study aims to understand the factors influencing the adoption of internet banking services among rural customers in Bangladesh. To acquire data, a questionnaire was administered to 443 rural bank customers in the district of Barisal. The Exploratory Factor Analysis (EFA) revealed three primary factors: trust compatibility, service benefit, and access to consumer education. In addition, the research sought to determine if the identified factors, particularly access to consumer education, varied according to the occupation and income level of rural consumers. Using exhaustive Chi-squared Automatic Interaction Detection (CHAID) analysis, the findings revealed that access to consumer education differs significantly by occupation level, with business and service holders being more likely than farmers to have access to consumer education. This research contributes to the literature by providing insights into the adoption of internet banking by rural customers and informing policymakers about the special needs of this demographic.