A multilevel analysis of factors influencing the adoption of Internet Banking

The Internet is an outcome of the convergence of multiple technologies and its applications have the potential to strongly influence many industries. Focusing on the banking industry, we examine the factors that influence the adoption of the Internet at three levels of analysis: the external context of the industry; the industry; and the firm. At the external context level, we analyze how the development of a favorable external context facilitates the adoption of a new technological application: Internet banking. At the industry level, we examine the types of innovations that a new technological application engenders, the role incumbents, and new entrants play in promoting the adoption of Internet banking, and other factors that impact the speed of Internet banking diffusion. At the firm level, we examine differences in banksʹ strategies and organizational designs associated with the adoption of Internet banking as an added delivery channel versus as a separate business. We conclude by discussing unique features in the emergence and adoption of Internet banking and its potential performance implications.