A TAM-Based Study of Online Payment Adoption Among Sri Lankan Students with a Focus on Security and Awareness

The use of Digital Financial Technologies (DFTs) as a form of making transactions and purchasing goods and services is becoming increasingly common among young people in developing countries. Extending the Technology Acceptance Model (TAM), this paper investigates the adoption of online payment by undergraduates in Sri Lanka, extending TAM by introducing Trust and Security (TS) and Awareness (AWA). The factors used in the research model are Perceived Usefulness (PER), Perceived Ease of Use (EAS), Trust and Security (TS), Awareness (AWA), Attitude toward Use (ATT) and Actual Usage (ACT). This research model is used to analyze the factors that influence the students directly and indirectly. Data were collected from 367 university undergraduates of University of Jaffna in Sri Lanka. This study was used a structured online self-reported questionnaire, and were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM) with SmartPLS 4.0 modeling tool. The results show that all four independent variables (PER, EAS, AWA, and TS) had a meaningful and positive effect on ATT. However, PER and EAS were not directly related to ACT, except through the ATT path. This indicates that besides ATT, users' awareness, trust and security perceptions were important in influencing undergraduates' behavior regarding their online payment adoption. Thus, online payment initiatives aimed at undergraduates should include education among the trust of its use, ease of use, and security to convince users to adopt the technology. An extended TAM model may have wider implications for understanding how students in developing countries adopt online payment technology, assist banks and fintech in implementing strategies to encourage cashless payment adoption in emerging markets.