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Complacency, capabilities, and institutional pressure: understanding financial institutions’ participation in the nascent mobile payments ecosystem

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  • Kui Du

    (University of Massachusetts Boston)

Abstract

As mobile payments become increasingly popular, their ecosystem is also evolving. The participation of financial institutions in this ecosystem, although is rapidly improving, remains relatively low. This paper studies why some financial institutions choose to, or not to, participate in this nascent mobile payments ecosystem. We developed hypotheses for the influence of three factors as aspiration gaps, customer-facing IT capabilities, and institutional pressures based on three theoretical foundations including the threat rigidity thesis, capability-based view, and institutional theory. We then empirically tested our hypotheses by analyzing the diffusion of mobile payments among 3549 U.S. credit unions from 2013 to 2016. Results from our event history analyses provide support to the hypotheses that credit unions experiencing performance gaps, having superior customer-facing IT capabilities, and facing strong institutional pressures are more likely to start providing mobile payment services.

Suggested Citation

  • Kui Du, 2018. "Complacency, capabilities, and institutional pressure: understanding financial institutions’ participation in the nascent mobile payments ecosystem," Electronic Markets, Springer;IIM University of St. Gallen, vol. 28(3), pages 307-319, August.
    • Handle: RePEc:spr:elmark:v:28:y:2018:i:3:d:10.1007_s12525-017-0267-0
    DOI: 10.1007/s12525-017-0267-0
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    Cited by:

    1. Rainer Alt & Roman Beck & Martin T. Smits, 2018. "FinTech and the transformation of the financial industry," Electronic Markets, Springer;IIM University of St. Gallen, vol. 28(3), pages 235-243, August.
    2. Palmer, Mark & Toral, Inci & Truong, Yann & Lowe, Fiona, 2022. "Institutional pioneers and articulation work in digital platform infrastructure-building," Journal of Business Research, Elsevier, vol. 142(C), pages 930-945.

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    More about this item

    Keywords

    Mobile payment; Credit union; FinTech; Ecosystem;
    All these keywords.

    JEL classification:

    • M15 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - IT Management

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