Factors Affecting Mobile Payment Adoption By Merchants In Ethiopia

Nowadays the world witnessed a rapid growth in mobile commerce and widespread use ofrnmobile devices. The growth of mobile commerce depends on widely accepted mobilernpayment systems. However, this trend is not well experienced in developing countries likernEthiopia. Even though merchants somehow benefited from the rapid growth in electronicsrncommerce and use of mobile devices in e-commerce, they still hesitate to effectively employrnin their day to day transactions. Little research has been conducted to examine and explainrnthe merchants' views on the new payment technology.The purpose of this study is to identifyrnfactors affecting merchants’ adoption of mobile payment in Ethiopia considering CBE Birrrnand M-birr as a case. Accordingly, it is tried to answer the question “What are the factors thatrnaffect merchants’ adoption of mobile payment in Ethiopia?” The study employed arndescriptive survey and adopted a research model from ÖRS (2018). The model is build basedrnon the most frequently used constructs affecting the latent variable in the mobile paymentrnsystem. The variables reflected in this study are usefulness, ease of use, security, cost,rncompatibility, social influence, enjoyment, anxiety, knowledge, and innovativeness. Thus,rnthis study reviews different models and pick this model since it is best for the study area withrnrespect to merchants’ adoption of mobile payment.Data was gathered from merchants inrnAddis Ababa and Oromia special zone, surrounding Addis Ababa who are using CBE Birrrnand M-birr mobile payment system. The survey was conducted using a self-administeredrnquestionnaire. Out of 376 questionnaires that have been distributed to participants, 363 validrnquestionnaires were collected and used for data analysis. The proposed mobile paymentrnmodel was tested using a partial least square with the help of the SmartPLS software. Thernproposed mobile payment model explained 94.8% overall variance in adoption. Thernempirical evidence of the study indicated that ease of use, usefulness, relative advantage,rntrust, risk, attitude and cost are influencing factors for mobile payment adoption whereasrncompatibility was found to have an insignificant effect on merchants’ mobile paymentrnadoption. Attitude is the most influencing factor of the merchant's mobile payment adoption.rnThe study provides a wide-ranging understanding of the factors that affect merchants’rnadoption of mobile payment technology in Ethiopia. This can help the service providers tornunderstand merchants’ intentions and make strategy accordingly to ensure financial inclusion.rnConsidering the shortage of literature that currently exists in general about technologyrnadoption, in particular about mobile payment adoption in Ethiopia, the study can bernconsidered as an addition to mobile payment-related literature and can serve as a springboardrnfor future researchers on the topic. Since this study was conducted in Addis Ababa, Ethiopiarnfurther studies may also consider selecting respondents from other areas outside of AddisrnAbaba, as well as incorporating additional social and cultural beliefs in understanding thernaffecting factors to adopt mobile payment.

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