A study on the use of Internet banking among SMES in Mauritius
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26 November 2022
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This paper analyses the factors affecting the adoption of Internet Banking among SMEs in Mauritius, especially at a time when the country is being promoted as a cyber island and the empowerment of SMEs has been at the forefront of the economic programme of the Government. The purpose of this study are to identify the push factors and barriers affecting the adoption of internet banking among SMEs. The paper also examines sectoral differences in the adoption and use of internet banking, identifies the internet banking services mostly used by the Mauritian SMEs and determines the prospects of use of Internet Banking in the future among current non-users. For this purpose, a questionnaire was administered to owner managers of SMEs operating in diverse sectors of the economy. A probit model is used to identify the correlation between the use of Internet Banking and some related factors. The results reveal that female SME owner/managers are more inclined to use Internet Banking. Furthermore firms’ profiles and owner managers’ characteristics, such as age group, good relationship with banks, high level of education, higher annual turnover, subscription to an internet package, presence of a computerized accounting system and operations in sophisticated sectors, were positive determinants that contributed towards Internet Banking usage. The other factors that determine the adoption of Internet Banking among SMEs are related to trust and security, awareness, convenience and accessibility. On the other hand, the internet services that are most widely used are inter-account funds transfer, payments by office cheque, receiving payments from customers, foreign transfer, request for the issue of current account statement and transactions related to savings/current or fixed deposit accounts. Among the current non-users, owner managers of the younger generation are the ones who are more likely to use Internet Banking in the future.