Analysing slow growth of mobile money market in India using a market separation perspective

ABSTRACT

Since the application of mobile technology for financial services can contribute to the economic development of developing countries, it is critical to examine the inhibitors to using mobile money service in countries like India, which have an exceptionally low uptake of this service. Mobile money service enables the customer to carry out financial transactions over a mobile phone without requiring them to own a bank account. By adopting a market separation perspective, this theory-driven, exploratory study proposes and tests a rare event logistic regression model for using mobile money services in India. The analysis of 45,036 responses shows that the ownership of a SIM card (temporal separation), income and ownership of a bank account (financial separations), awareness of mobile money services (information separation), age and gender (social separations), and location of residence (spatial separation) significantly inhibit the use of mobile money services. Implications are discussed at the end.

KEYWORDS:

• Financial inclusion
• Mobile money
• Market separation perspective
• SIM card
• Bank account
• India

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes on contributors

Devendra Potnis is an Associate Professor at the University of Tennessee at Knoxville. He holds a doctoral degree in information science from the University at Albany, State University of New York. His research focuses on the adoption of mobile technologies, applications and services by students, marginalized communities, libraries, microfinance institutions, and governments. He has published interdisciplinary research in Communications of the Association for Information Systems, First Monday, Government Information Quarterly, Information Development, IT and Libraries, IT for Development, Journal of Education for Library and Information Science, Library & Information Science Research, Telematics and Informatics, The Information Society, and other respected journals. He has received funding from the Institute of Museum and Library Services, Online Computer Library Center, and Association for Library and Information Science Education in the past.

Aakanksha Gaur is currently a Junior Lecturer, Information Systems at the SDA Bocconi School of Management, Milan, Italy. Her broad research areas include access and use of Information and Communication Technologies (ICTs) in the context of emerging economies, digital transformation and impact, and usage of digital technologies such as artificial intelligence and augmented reality. She is also a core researcher of the DEVO lab, the digital laboratory of the SDA Bocconi that focusses on projects related to the implementation of digital technologies and digital transformation initiatives in organizations and how managers can successfully manage their implementation. Prior to joining SDA Bocconi, she worked as a researcher for the H2020 projects sponsored by the European Union in the domain of business models and public sector innovation. she holds a Ph.D. in Business Administration (with specialization in Information Systems) from ESSEC Business School, France.

Jang Bahadur Singh is an Assistant Professor in the Management Information Systems Area, IIM Tiruchirappalli. He holds a doctorate from IIM Bangalore and M Tech degree from IIT Kharagpur. His current research focuses on the understanding information technology related societal issues in India (such as digital divide and digital literacy) using large scale publicly available datasets. His interest also encompasses application of data mining techniques for business-decision making. He has publications in the Journal of Knowledge Management, Economic and Political Weekly, and his research papers have been accepted for presentations in premier international conferences such as ECIS, AMCIS and International Conference on Electronic Government.