Factors Affecting the E-Wallet Adoption in a Cashless Society

by Nizar Bin Misbah

February 2022


E-wallets are one of the fastest-growing payment trends in Malaysia. Whilst cash payments continue to be the most popular payment method in Malaysia, a shift in the trend may be noted as the use of cashless payments increases. However, one disadvantage of e-wallets is the loss of client privacy because of online information sharing.

This study aimed to ascertain the factors that contribute to the adoption of e-wallets in Malaysia. The theories applied in this study were the TAM Theory and UTAUT theory. The data were gathered by distributing a structured questionnaire to 428 participants which were analysed using the Partial least square structural equation model (PLS-SEM). The convenience sampling approach was utilised to choose the study sample, which included e-wallet users in the Klang Valley, Malaysia.

The findings indicate that convenience, security, and speed significantly influence e-wallet adoption in Malaysia. Social influence is indirectly related to e-wallet adoption in terms of comfort and security. Therefore, the decision to adopt the service is influenced by the opinions of family members and friends. The study’s implications will be felt by facility providers and entrepreneurs who may profit from the principles offered by this research to develop their services more efficiently.

Furthermore, existing firms might concentrate on components that will boost e-wallet services. Entrepreneurs considering starting a business can forecast customer preferences using an e-wallet. It is recommended for future research to compare the usage of e-wallets with the third world countries and to include gender and age variables as moderators which influence the relationships between the predictor and explanatory variables

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