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Determinants of Trust in Banks’ Payment Services During COVID: An Exploration Using Daily Data

Author

Listed:
  • Michiel Bijlsma

    (SEO Amsterdam Economics
    Tilburg University)

  • Carin Cruijsen

    (De Nederlandsche Bank)

  • Jester Koldijk

    (Tilburg University)

Abstract

Trust in banks is key, especially in turbulent times. Using unique daily data for a representative panel of Dutch consumers, we examine to what extent the COVID-crisis has affected trust in banks’ payment services. We have the following main findings. First, COVID-19 measures have affected trust in banks’ payment services. The first lockdown increased narrow-scope trust (trust in consumers’ own bank payment services) and broad-scope trust (trust in banks’ payment services in general). The second lockdown decreased both notions of trust. The crisis measures impacted the trust of the elderly the strongest. Second, personal characteristics are significantly related to trust in banks’ payment services. For example, we find that both types of trust are increasing with digital literacy and the ease of getting by with income. Third, narrow-scope trust is higher than broad-scope trust. The gap between trust in the own bank and trust in banks in general is highest for customers of small banks.

Suggested Citation

  • Michiel Bijlsma & Carin Cruijsen & Jester Koldijk, 2022. "Determinants of Trust in Banks’ Payment Services During COVID: An Exploration Using Daily Data," De Economist, Springer, vol. 170(2), pages 231-256, May.
    • Handle: RePEc:kap:decono:v:170:y:2022:i:2:d:10.1007_s10645-022-09405-9
    DOI: 10.1007/s10645-022-09405-9
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    Cited by:

    1. van der Cruijsen, Carin & de Haan, Jakob & Jonker, Nicole, 2022. "Has the COVID-19 pandemic affected public trust? Evidence for the US and the Netherlands," Journal of Economic Behavior & Organization, Elsevier, vol. 200(C), pages 1010-1024.
    2. Marie-Claire Broekhoff & Carin van der Cruijsen & Jakob de Haan, 2023. "Towards financial inclusion: trust in banks’ payment services among groups at risk," Working Papers 795, DNB.

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    More about this item

    Keywords

    Trust in banks; COVID-19; Crises measures; Payments; Payment diary data;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages

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