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Industrial Management & Data Systems
What makes users willing or hesitant to use Fintech?: The moderating effect of user type
Hyun-Sun Ryu,
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What makes users willing or hesitant to use Fintech?:
The moderating effect of user type
Abstract
Purpose – The purpose of this paper is to better understand why people are willing or hesitant to use
Financial technology (Fintech) as well as to determine whether the effect of perceived benefits and
risks of continuance intention differs depending on user types.
Design/methodology/approach – Original data was collected via a survey of 243 participants with
Fintech usage experience. The partial least squares method was used to test the proposed model.
Findings – The results reveal that legal risk had the most negative effect on the Fintech continuance
intention, while convenience had the strongest positive effect. Differences in specific benefit and risk
impacts are found between early and late adopters.
Originality/value – This empirical study contributes to the novel understanding of the benefit and
risk factors affecting the Fintech continuance intention.
Keywords – Fintech, Continuance intention, Perceived benefit, Perceived risk, Net valence
framework, User Type.
Paper type – Research paper
1
1. Introduction
Advances in information technology (IT) have led to the rapid expansion of new and innovative
financial services, often called Financial technology (Fintech), an emerging field that is attracting a
significant amount of attention. Fintech is a portmanteau combining the words “financial” and
“technology.” According to the Accenture report (Skan et al., 2014), worldwide investment in Fintech
companies and start-ups increased dramatically from $4.05 billion (USD) in 2013 to $12.2 billion
(USD) in 2014. Fintech provides new opportunities to empower people by increasing transparency,
reducing costs, eliminating middlemen, and making financial information accessible (Zavolokina et
al., 2016a). Fintech companies are currently expanding their business scope beyond the online
platform into the mobile platform (e.g., mobile payment, mobile remittance). The traditional online-
banking system, provided by traditional financial institutions, is also changing into innovative and
differentiated financial services offered by non-financial providers.
While Fintech has attracted a significant amount of attention, a continuous use of Fintech is still
doubtful. Some users are skeptical of continuing to use Fintech because it has considerable risks.
More specifically, an investigation conducted in May of 2016 on Lending Club, one of the most
famous P2P lending companies in the world, revealed that the company’s executives sold $22 million
in loans to investors, even though they knew that those transactions did not meet the buyers’ criteria.
Consequently, Lending Club’s founder and CEO were forced out and Lending Club’s shares
plummeted by 35 percent. This scandal raised questions about the P2P lending business model. These
unexpected Fintech use risks may negatively affect users’ experience and impede their continuous
use. If Fintech companies cannot retain customers and facilitate continuous use, they will not recover
these costs and achieve long term success.
Customers want to determine the expected value of Fintech usage, considering both its benefits and
its risks. Customers will use the product or service if its benefits are greater than its risks. Thus,
Fintech companies are challenged to increase the potential benefits of Fintech usage, while limiting its
potential risks (Chan, 2015). Hence, it is necessary to identify the factors that help determine why
people continue to use Fintech.
2
Previous studies have identified the main drivers influencing user behavioral intentions in the IS
literature (Chiang, 2013; Kim et al., 2010; Liang and Yeh, 2011; Zhou, 2013). However, few studies
have simultaneously covered both benefits and risks in the Fintech context. Furthermore, while there
is a need to understand the user-group level behavior, there has been little attempt to fill the gap in the
user-group level research in Fintech. To bridge these research gaps, the purpose of this study is to
determine how specific positive (perceived benefits) and negative factors (perceived risks) jointly
influence the continuous use of Fintech, based on a net valence framework theoretically grounded on
the theory of reasoned action (TRA) (Ajzen and Fishbein, 1977).
To increase the understanding of Fintech usage behavior, Fintech users were categorized into early
and late adopter categories. The user-group level behavior was then analyzed. The following research
questions motivated this study:
1) Does users’ perception of benefits and risks significantly influence the Fintech continuance
intention?
2) What specific benefit and risk factors influence the Fintech continuance intention?
3) Do the perceived benefits and risks differ between early and late adopters?
Empirical data from 243 Fintech users in Korea were collected. The data was used to explore the
effect of the perceived benefits and risks on the Fintech continuance intention. How the benefit and
risk factors differed between early and late adopters was then determined.
This study intends to make the following contributions to the literature. Firstly, this study attempts
to enlarge the scope of the continuous usage decision to explicitly include both positive (perceived
benefit) and negative (perceived risk) factors simultaneously. Secondly, based on the net valence
framework, this study can help practitioners better understand the benefit and risk perceptions that
may be used to develop benefit-increasing and risk-reducing strategies to encourage the use of
Fintech. Lastly, our findings provide Fintech companies with valuable information on what factors
should be prioritized or avoided when offering Fintech to their users.
The remainder of this study is organized as follows. Section 2 presents the theoretical background,
based on the previous literature. Section 3 discusses the research model and the hypotheses. Section 4
3
describes the research methodology; this is followed by the statistical analysis and results in Section
5. Finally, Section 6 presents the findings, implications, limitations and future research directions.
2. Theoretical background
2.1 Fintech
Fintech is an emerging filed that combines financial and IT services. Fintech is not confined to
specific sectors (e.g., financing) or business models (e.g., peer to peer (P2P) lending and
crowdsourcing). Instead, it covers the entire scope of financial services and products traditionally
provided by financial institutions (Arner et al., 2015). Sweeney (2015) and Kuo-Chuen and Teo
(2015) defined Fintech as products or services in non-financial institutions created on highly
innovative and disruptive service technologies. Freedman (2006) described Fintech as building
systems that model, value, and process financial products (e.g., bonds, stocks, contracts, money).
Ernst and Young (2015) defined Fintech as an innovation in financial services with technology as the
key enabler. Lee (2015) described Fintech as a type of business using hardware and software
technologies to provide financial services. Arner et al. (2015) defined Fintech as technology-enabled
financial solutions. Lee and Kim (2015) indicated that Fintech is the technical process resulting from
developing and establishing new financial software which might affect the entire traditional system.
Consequently, Fintech might improve the performance of financial services and expand financial
services to mobile environments.
Although the link between financial and IT services is not novel, Fintech differs from the existing
electronic financial services in terms of opportunities, risks and legal implications. Current concerns
of policymakers and industry are not coming from the technology itself. They are concerned with who
(e.g., IT companies) is applying the finance technology and providing financial services to customers
(Arner et al., 2015). The expanding and strengthening role of IT is also a significant characteristic of
Fintech. Development in traditional electronic financial services has resulted in the emergent Fintech
as an advanced strategy to provide financial services (Arner et al., 2015). Ernst and Young (2015)
explained the differences between traditional electronic finances (e.g., e-banking) and Fintech.
4
Specially, they pointed out the new role of IT in Fintech. The role of IT in Fintech is not as a
facilitator or enabler to effectively deliver financial services, but as an innovator that disrupts the
existing value chain by bypassing the existing channels. Fintech companies can directly provide their
customers with standardized or customized financial services in the front office by disrupting and
substituting the existing channel.
In this study, Fintech was defined as “innovative and disruptive financial services by non-financial
companies, where IT is the key factor.” With Fintech, users may engage in a variety of mobile
services: making payments, transferring money, making loan requests, purchasing insurance,
managing assets, and making investments (Barberis, 2014). In this study, Fintech includes mobile
payment, mobile remittance, P2P lending and crowdfunding1.
2.2 Benefit-risk framework
Users often make a decision with incomplete or imperfect information (Kim et al., 2008). As a
result, users often face a degree of risk, or uncertainty, in usage decisions. Risk is not the only factor
that users depend on in the context of continuance intentions. Perceived benefits also provide users
with an incentive for usage decisions (Wilkie and Pessemier, 1973). Combining the perceived benefits
and risks, Peter and Tarpey (1975) provided a net valence framework assuming that consumers will
perceive products or services with positive and negative attributes and make decisions to maximize
net valence, based on the negative and positive attributes of the decision. The valence theory is also
consistent with theories by Lewin (1943) and Bilkey (1953), providing a theoretical framework for
this study.
The purpose of this study was to better understand the net valence framework based on the theory
of reasoned action (TRA). TRA asserted that attitudes toward behavior are precise predictors of
individual behavioral intentions (Ajzen and Fishbein, 1977; Benlian and Hess, 2011). Drawing from
TRA, the intention to continuously use Fintech would depend on users’ perceptions towards the use of
1
P2P lending refers to a type of financial transactions directly occurring between lenders and borrowers without
intermediation of a traditional financial institution (Lee and Lee, 2012), whereas crowdfunding is an open call on the Internet
for financial resources in the form of a monetary donations, in exchange for a future product, service, or reward (Gerber et
al., 2012).
5
Fintech, which is influenced by behavioral beliefs. More specifically, the benefits and risks of Fintech
usage might be considered behavioral (positive and negative) beliefs that determine attitudes and
subsequent behavioral intentions and actions (Jurison, 1995). Accordingly, the positive beliefs of
Fintech usage will increase the perceived benefits, whereas the negative beliefs will result in
perceived risks. Based on this notion, this study examined whether users would determine specific
benefit and risk factors that might lead to their continuous use of Fintech. The result would be an
overall attitudinal appraisal of Fintech usage (i.e., overall perceived benefit and risk), leading to the
Fintech continuance intention.
Table I illustrates that considerable studies have examined the benefit-risk framework affecting the
decision making process to adopt or use IT services (Abramova and Böhme, 2016; Benlian and Hess,
2011; Farivar and Yuan, 2014; Kim et al., 2008; Lee et al., 2013a; Lee, 2009; Lee et al., 2013b). Most
of these studies have considered the perceived benefits and risks with a multi-dimensional concept
that usually contains several benefit and risk types. Kim et al. (2008) proposed a decision-making
model about e-commerce purchasing intentions. In the study, they considered both perceived benefits
and risks in a single dimension, not a multi-dimension. Lee (2009) proposed a theoretical model to
explain users’ intention to use online banking. In this study, perceived risk was understood in a multi-
dimensional manner (i.e., security/privacy, financial, social, time/convenience, performance risks),
whereas perceived benefit was seen as single construct. Benlian and Hess (2011) analyzed
opportunities and risks associated with adopting software as a service (SaaS), perceived by IT
executives from adopter and non-adopter firms. In this study, they proposed five types of benefits (i.e.,
cost advantage, strategic flexibility, focus on core competencies, access to specialized resources,
quality improvements) and five types of risks (i.e., performance, economic, strategic, security, and
managerial risks) associated with SaaS adoption.
Lee et al. (2013a) investigated the benefit and risk factors that influence the intention to share
information on a social network service and determined that users’ behavior would maximize their
benefits and minimize their risks in the process. This study suggested five types of benefits (i.e., self-
clarification, social validation, relationship development, social control and self-presentation) and five
types of risks (i.e., security risk, stigma risk, face risk, relational risk, and role risk) related to context
6
information sharing. Farivar and Yuan (2014) proposed a theoretical model to analyze users’ social
network adoption behavior, considering the perceived benefits, perceived risks, and trust from the
benefit-risk framework. They adopted two positive factors (i.e., social and commerce benefits) as
perceived benefits and two negative factors (i.e., social and commerce risks) as perceived risks.
Abramova and Böhme (2016) explored the drivers and inhibitors of Bitcoin use. They suggested a
benefit–risk framework integrated with a technology acceptance model to explain the use of Bitcoin.
Three components of perceived benefits (i.e., seamless transaction, security and control, and
decentralization) and four components of perceived risks (i.e., financial losses, legal risk, operational
risk, and adoption risk) were included in their study.
Table I. Benefit-risk framework of IT service adoption and usage

Research
Authors Research Content Main factors of benefit Main factors of risk
Context
Investigated the
antecedents of trust and
Kim et al. (2008) e-commerce Single dimension Single dimension
risk based on the benefits-
risks framework
-Security/privacy risk
Explained the intention to -Financial benefit -Financial risk
adopt online banking -Transaction speed -Social risk
Lee (2009) Internet banking
combining perceived -Information transparency -Time/convenience risk
benefits and risks. -Performance risk
-Cost advantage -Performance risk

Assessed the major -Strategic flexibility -Economic risk
Benlian and Hess SaaS (Software opportunities and risks -Focus on core competencies -Strategic risk
(2011) as a service) associated with the -Access to specialized resources -Security risk
Intention to adopt SaaS -Quality improvements -Managerial risks
Investigated the mobile -Financial risk

payment adoption based -Privacy risk
Liu et al. (2012) Mobile payment Single dimension
on the risks-benefits -Psychological risk
analysis
-Price benefit -Financial risk
Investigated perceived -Convenience benefit -Psychological risk
Online group
benefits, perceived risks, -Recreational benefit -Product risk
Melewar et al. (2013) shopping and trust -Time risk
-Self-clarification -Security risk

Investigated benefit and -Social validation -Stigma risk
SNS (Social
risk factors influencing -Relationship development -Face risk
Lee et al. (2013a) network
Intention to share -Social control -Relational risk
service)
information in SNS -Self-presentation -Role risk
Analyzed users’ social -Social benefit -Social risk

Farivar and Yuan Social
network usage using -Commerce benefit -Commerce risk
(2014) commerce
benefits, risks and trust
7
-Transaction process, -Financial losses,
Abramova and Explored drivers and -Security and control -Legal risk
Bitcoin
Böhme (2016) inhibitors of Bitcoin use -Decentralization -Operational risk
-Adoption risk
2.3 Early adopters vs. late adopters
The speed of diffusion of a new IT service depends not only on the characteristics of the IT itself,
but also on the characteristics of the users to whom it is directed (Escobar-Rodríguez and Romero-
Alonso, 2014). For Fintech, individual differences have been generally expected to be related to the
use of Fintech, because interests in individual differences result in different perceptions of benefits
and risks. Understanding the distinction between the different users can help Fintech companies better
understand the characteristics of each user group to effectively deliver services, while meeting users’
expectations and demands, thereby improving the continuous use of Fintech.
Based on users’ innovativeness, Rogers (1995) has proposed five distinct adopter categories: 1)
innovators (those who are venturesome), 2) early adopters (opinion leaders who are widely respected
in their social circle), 3) early majority (those who are deliberate), 4) late majority (those who are
skeptical about the value of the innovation), and 5) laggards (those who are traditional). Kim et al.
(2010) chose to use only two categories: early adopters and late adopters. Early adopters adopt an
innovation, even if the uncertainty surrounding its potential use is high and the benefits of the
innovation are not widely visible or accepted. On the other hand, late adopters are resistant to change,
because they want to be certain that the innovation does not fail before they adopt it (Rogers, 1995).
User differences result in a variety of needs and expectations for adopting and using an innovation.
Jahanmir and Lages (2016) asserted that researchers and practitioners should target both early
adopters and late adopters to increase the success likelihood of the products or services, because the
late adopters of current services are likely to become the early adopters of the next generation of
services. Accordingly, comparing the characteristics of early and late adopter groups is critical to
understanding the willingness or hesitance to use Fintech. In this study, two Fintech user type
categories are considered: early and late adopters.
8
3. Research model and hypotheses
This study proposed a framework of benefit and risk by integrating the positive and negative factors
related to the Fintech usage decision. Previous studies applied the multi-behavioral belief constructs
to determine the overall perceived benefit and risk, as well as the subsequent continuance intention of
Fintech. Three major factors of perceived benefit were discussed: economic benefit, seamless
transaction, and convenience. Four major factors of perceived risk were illustrated: financial risk,
legal risk, security risk, and operational risk. Consequently, this study assumed that positive and
negative factors influence the overall perceived benefit and risk, which significantly affect the Fintech
continuance intention. This study also hypothesized that different Fintech user types (i.e., early
adopters and late adopters) have various expected benefits and risks. The proposed model is
summarized in Figure 1.
Figure 1. Research model
3.1 Benefit-risk framework for the continuous use of Fintech
The TRA is a well-researched intention theory that postulates that attitudes towards a behavior are
accurate predictors of individual intentions (Ajzen and Fishbein, 1977; Benlian and Hess, 2011). The
Fintech’s continuous intention is determined by Fintech users’ overall attitudinal appraisal of Fintech
9
use by applying the TRA to the Fintech context. It is known that users compare available services and
choose a service, or services, with the best value (Kim et al., 2008). When users make a risky decision,
they are willing to take risks to reap gains or benefits.
Perceived benefits have been widely used as a direct determinant of particular IS continuous
intentions (Kim et al., 2008; Lee et al., 2013a; Melewar et al., 2013). A perceived benefit is defined as
“a users’ perception of the potential that Fintech use will result in a positive outcome” in this study.
Previous studies have indicated that perceived benefits can positively influence users’ intention to use
IT services for different applications (Abramova and Böhme, 2016; Benlian and Hess, 2011; Farivar
and Yuan, 2014; Lee et al., 2013a; Lee, 2009; Lee et al., 2013b). A mobile payment study revealed
that perceived benefits can significantly affect mobile payment use (Liu et al., 2012). Likewise,
Abramova and Böhme (2016) indicated that perceived benefits have a positive influence on Bitcoin
use.
Perceived risks associated with a product or service has gained significance in the consumer and
innovation research (Lim 2003; Mitchell 1999). A perceived risk is a fundamental barrier for users
considering Fintech usage. This study defines the perceived risk as “a users’ perception of the
uncertainty and the possible negative consequences regarding the Fintech use.” In the IS literature,
perceived risks negatively affect the intentions to use IT services (Abramova and Böhme, 2016;
Benlian and Hess, 2011; Farivar and Yuan, 2014; Lee et al., 2013a; Lee, 2009; Lee et al., 2013b).
Abramova and Böhme (2016) revealed that multi-faceted perceived risk can significantly and
negatively influence bitcoin use.
Based on the theoretical underpinnings and empirical evidence of the literature review, this study
hypothesizes that users’ perceived benefit and risk play significant roles in the forming of the
intention to continuously use Fintech. The perceived benefit has a positive influence on the Fintech
continuance intention, while the perceived risk has a negative influence on such an intention.
Consequently, the following hypotheses are developed:
H1: Perceived benefit is positively related to Fintech continuance intention.
H2: Perceived risk is negatively related to Fintech continuance intention.
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3.2 Benefit factors for the continuous use of Fintech
Users’ motivations have been classified as extrinsic and intrinsic factors from the cognitive
evaluation theory (Davis et al., 1992). Extrinsic motivation refers to the performance of an activity to
achieve a specific goal (e.g., rewards), while intrinsic motivation refers to the performance of an
activity for no apparent reinforcement other than the process of performing the activity by itself
(Davis et al., 1989). Both extrinsic and intrinsic factors have been found to influence perceived
benefits and behavioral intentions in the IS literature. This study focused on the extrinsic motivation
factors, because Fintech users tend to use Fintech for their utilitarian benefits, not for their hedonic
benefits. For this reason, this study proposed three extrinsic motivations as the benefit components of
the overall perceived benefit: economic benefit, seamless transaction, and convenience.
Economic benefit is the most common and consistent extrinsic motivation for Fintech (Kuo-Chuen
and Teo, 2015). In the context of Fintech, the economic benefit includes cost reductions and financial
gains from Fintech transactions. Some Fintech applications (e.g., mobile remittance or P2P lending)
may suggest lower transaction costs to users than traditional financial service providers by directly
providing standardized services on a mobile channel without intermediation (Mackenzie, 2015). Other
Fintech applications (e.g., P2P lending, crowdfunding), that generally offer services online or via a
mobile platform, might also provide higher returns to lenders, and lower interest rates to borrowers,
than traditional financial institutions by using a match-making platform with a lower overhead cost
(Gerber et al., 2012; Lee and Lee, 2012).
A seamless transaction refers to the transaction-related benefit of using Fintech (e.g., buying,
money transferring, lending, investing). The seamless transaction process is an essential characteristic
of Fintech transactions that eliminates traditional financial institutions (e.g., banks) through the
finance process. It allows users to manage transactions on cost effective platforms, resulting in simple
and speedy financial transactions (Chishti, 2016; Zavolokina et al., 2016a). Furthermore, non-
financial providers (i.e., IT companies) can create and offer new, innovative and customer-friendly
financial products and services to users because they directly provide their products and services
through the seamless transaction. The seamless transaction induces that Fintech companies can
develop new and innovative financial products and services to compete against traditional financial
11
institutions and survive in the finance market. Thus, these Fintech companies are reshaping the
business ecosystems of the financial services industry.
Convenience is one of the extrinsic motivations of Fintech, which is driven by portability and
immediate accessibility (Kuo-Chuen and Teo, 2015; Sharma and Gutiérrez, 2010). Convenience
refers to flexibility in time and location (Okazaki and Mendez, 2013), the most important factor in the
success of online and mobile services (Kim et al., 2010). Users may acquire unprecedented
convenience and efficiency via mobile devices without traveling to financial institutions. Shen et al.
(2010) suggested that convenience might be useful as a valid predictor of the use of mobile banking
systems. Given mobile devices are critical channels in Fintech, as compared to traditional financial
service providers, convenience through mobile platforms is a plausible reason to determine the
perceived benefit of the intention to use Fintech. Economic benefit, seamless transaction, and
convenience might affect the overall perceived benefit of Fintech, thus affecting its Fintech
continuance intention. As such, this study has the following hypotheses:
H3: Economic benefit is positively related to perceived benefit.
H4: Seamless transaction is positively related to perceived benefit.
H5: Convenience is positively related to perceived benefit.
3.3 Risk factors for the continuous use of Fintech
Besides its perceived benefits, innovation usually comes with risks (Schierz et al., 2010). As
Fintech is an emerging and unprecedented service, Fintech users are vulnerable to far-reaching risks.
For Fintech, the risk of the likelihood of inadequate or failed operations is very problematic for the
continuous use of Fintech. We used the perceived risk framework developed by Cunningham (1967)
to derive the individual risk factors influencing the overall perceived risk of Fintech (Cunningham,
1967). Cunningham (1967) categorized perceived risk into six dimensions: performance, financial
consideration, opportunity/time, safety, social factors, and psychological factors. When transferring
the Cunningham (1967) framework to the Fintech context, this study developed the following four
types of risks as perceived risk factors: 1) financial risk; 2) legal risk; 3) security risk; and 4)
operational risk.
12
Financial risk refers to the potential financial loss in the financial transactions of Fintech (Forsythe
et al., 2006). Prior research studies in the IS literature have found that perceived financial risk is the
most consistent predictor of online and mobile user behavior (Abramova and Böhme, 2016; Benlian
and Hess, 2011; Melewar et al., 2013). The financial losses of Fintech, caused by the malfunction of
the financial transaction system, financial fraud, moral hazard, and extra transaction fees associated
with the initial adoption price (World Economic Forum (WEF), 2015; Zavolokina et al., 2016b), are
negatively related to the intention of continuous use.

Legal risk refers to an unclear legal status and the lack of universal regulations for Fintech. For
example, Korean government aggressively intervenes in the management of Korean financial
institutions and financial market because Korean government considers financial services as public
services. Thus, Korea has strict financial regulations that can strongly hinder the entry and growth of
Fintech businesses. It makes users reluctant to use Fintech. As Fintech is unprecedented in the market,
the lack of regulations regarding the financial loss and security issues of Fintech has resulted in users’
distrust and anxiety.
Security risk is defined as the potential loss due to fraud or a hacking that compromises the security
of the financial transactions of Fintech. In the context of electronic services, security risk is
conceptualized as the likelihood of a privacy invasion; this is a critical concern among consumers
(Lwin et al., 2007). Fraud and hacker intrusions can lead to users’ monetary loss and violate users’
privacy, which is a major concern of many online and mobile users (Lee, 2009). The use of Fintech is
associated with a relatively high loss potential (i.e., privacy, personal data, transactions) (Schierz et
al., 2010); this also increases the perceived risk of Fintech.
Operational risk is a critical barrier for users, since many major operational losses have hit large
financial institutions, leading to the severe financial disturbance or collapse of these institutions (e.g.,
Lending Club). Operational risk refers to the potential loss due to inadequate or failed internal
processes, employees and systems (Barakat and Hussainey, 2013). If the risk likelihood of Fintech
companies’ financial systems and operations is high, users will not continue to use Fintech. Lack of
operational skills and immediate responses, the malfunction of systems, and inadequate internal
processes will result in users’ distrust and dissatisfaction, leading to the hindrance of Fintech usage.
13
Due to the perceived risks (e.g., financial loss, security issues, the absence of regulations), users
will make usage decisions based on the good reputation of Fintech companies in terms of operational
skills and advanced systems. Consequently, the four types of risks might significantly affect the
overall perceived risk of Fintech, thus negatively influencing the continuance intention of Fintech.
Consequently, this study proposes the following hypotheses:
H6: Financial risk is positively associated with perceived risk.
H7: Legal risk is positively associated with perceived risk.

H8: Security risk is positively associated with perceived risk.
H9: Operational risk is positively associated with perceived risk.
3.4 Moderating effect of user type
The diffusion speed of a new technology not only depends on the characteristics of that technology,
but also on the characteristics of users. Karahanna et al. (1999) noted that the model used to test the
impact of different users on IS usage may reveal novel insights. Since users would adopt and use new
services or technologies at different time periods and degrees, this study classified Fintech users as
early adopters and late adopters, based on the responses to the new technology (Kim et al., 2010).
Consistent with the previous empirical studies (Escobar-Rodríguez and Romero-Alonso, 2014;
Hong and Zhu, 2006; Kim et al., 2010), early adopters are referred to as individuals who are interested
in adopting new technologies or services and are willing to take a risk. On the other hand, late
adopters are referred to as people who are more reserved in adopting new technologies or services and
are skeptical about the adoption. Early adopters function as opinion leaders who encourage others to
adopt and use an innovation by providing evaluative information (Rogers, 1995). They make critical
decisions on adoption, even though the benefits and losses have not been clearly defined yet (Harrison
and Waite, 2006). Late adopters are resistant to change. They are also suspicious of the agents of
change (Escobar-Rodríguez and Romero-Alonso, 2014). Late adopters want to be certain that the
innovation and benefits of novel products or services will not fail before adopting them (Rogers,
1995).
14
Customers in the financial sector are more conservative in adopting new technologies than those in
other sectors, because of the specific characteristics of the financial sector (i.e., the significance of
structural assurance, trust in financial transactions and trust in vendors). Thus, the innovation
diffusion process in the financial sector is slower than in the other sectors, which is difficult to create
innovative financial services, despite the many transaction process evolutions using IT in the financial
sector (Zavolokina et al., 2016a; Zavolokina et al., 2016b). Hence, distinctions between early and late
adopters in financial sector are more significant than that in other sectors. Comparing the
characteristics of early and late adopters can provide researchers and practitioners with valuable
insight.
Escobar-Rodríguez and Romero-Alonso (2014) indicated that early adopters are more willing to
adopt and use new information technologies. They also have a more positive attitude towards IT
innovation than late adopters. Late adopters are reluctant to actively use new information
technologies. They have a negative attitude about adopting and using new services with technology.
Early adopters expect that the benefit of Fintech usage is greater than the risk, whereas late adopters
perceive the risk of Fintech usage as greater than its benefit. As a result, the following hypotheses
have been developed:
H10: The effect of perceived benefit on Fintech continuance intention in early adopters is greater
than in late adopters.
H11: The effect of perceived risk on Fintech continuance intention in late adopters is greater than in
early adopters.
4. Research methodology
4.1 Measurement
To achieve content validity, the measurement items were developed based on the intensive
literature review. Comprehensive multiple-item measures were developed based on previous
innovation and the IS literature to measure three benefit factors (i.e., economic benefit, convenience,
and seamless transaction), four risk factors (i.e., financial risk, legal risk, security risk, and operational
risk), perceived benefit, perceived risk, and continuance intention of Fintech. Before conducting the
15
main survey, a pre-test was performed to examine the reliability and validity of the instruments. The
pre-test involved 30 respondents who had experience using Fintech. The pre-test results led to a
significant refinement and restructuring of the questionnaire. The initial face and internal validity of
the measures were also established. The measures were evaluated with a seven-point Likert-type
scale, ranging from “extremely low” (1) to “extremely high” (7). The structure of the measurements
used and the relevant studies are shown in the Appendix.

4.2 Sample and data collection
The data collection process was outsourced to Embrain Co. (www.embrain.com), a large market
research company in Korea with more than 1.8 million panels in various Asian countries. For our
main survey, the company first sent e-mail invitations to the targeted panels. If they accepted the offer
to participate, they were guided to websites built by us. The invitation continued until 1,000 panels
accepted the offer. Embrain has a solid reputation for managing panels for data authenticity. The
company carefully selected participants from a pool of panels based on the specific requests of clients.
The company also maintains a record of respondents to control panel integrity. If inconsistency was
detected during a response in the panel, the data from that panel were discarded and the respondent
was excluded from the panel pool (i.e., company policy on spurious panels). Respondents who had
Fintech usage experience were asked to respond to the entire questionnaire. To ensure that the
respondents fully understood the survey context, an initial screening question was asked to determine
if they were currently using Fintech. The four types of Fintech used were mobile payment, mobile
remittance, P2P lending, and crowdfunding. If the respondents responded negatively to the question,
they were not allowed to participate in the survey.
A total of 265 responses were received, of which 21 were classified as outliers and eliminated.
Finally, 243 responses were used in this study, indicating a usable response rate of 24.3 percent. Table
II summarizes the characteristics of the respondents. The distribution of the response, according to the
four types of Fintech, included: mobile payment (28.4%); mobile remittance (27.2%), crowdfunding
(24.7%), and P2P lending (19.8%). In terms of the age and education distribution, the sample had a
16
significantly larger proportion of users aged 40-49 years (29.2%). Overall, 60.5% of respondents had
a Bachelor’s degree. Table II illustrates that most respondents had Fintech experience within one year
(76.2%) and used Fintech monthly and weekly (36.6% and 26.3%, respectively). Most mobile
payment and mobile remittance users applied Fintech weekly or monthly, whereas most P2P lending
and crowdfunding users applied Fintech monthly or every six months. The average interval of using
P2P lending and crowdfunding was longer than that of using mobile payment and mobile remittance.
Table II. Sample characteristics

Division Freq. Percent Division Freq. Percent
Gender Male 112 46.1% Fintech Mobile payment 69 28.4%

Female 131 53.9% type Mobile remittance 66 27.2%
Total 243 100% P2P lending 48 19.8%
Crowdfunding 60 24.7%
Fintech Early adopters 161 33.7% Total 243 100%
users Late adopters 82 66.3%
Total 243 100%
~3 month 88 36.2%
Age Under 20 0 0% Period of ~6 month 57 23.5%
20~29 55 22.6% use ~12 month 40 16.5%
30~39 60 24.7% ~18 month 11 4.5%
40~49 71 29.2% ~24 month 18 7.4%
50 over 57 23.5% 24 month over 29 11.9%
Total 243 100% Total 243 100%
Education Under high school 1 0.4% Frequency Daily 3 1.2%

High school 26 10.7% of use Weekly 64 26.3%
College/associate 39 16.0% Monthly 89 36.6%
Bachelor 148 60.5% Every 3mon. 43 17.7%
Master 25 10.7% Every 6 mon. 22 9.1%
PhD 4 1.6% Once 1 year or less 15 6.2%
Total 243 100% Once 2 year or less 7 2.9%
Total 243 100
Before the final analysis, the common method variance (CMV) was evaluated. To manage the
CMV and improve data quality, three analyses were conducted to test the effect of the CMV. The first
analysis was a Harman’s single factor test. If the common method variance was a serious issue in the
collected data, either a single factor emerged from a factor analysis or one general factor account for a
majority of the covariance. A factor analysis was conducted for all of the items. The results validated
that eight factors were extracted with an eigenvalue that was greater than one and no general factor
was apparent in the unrotated factor structure, indicating no excessive CMV. The second analysis was
a partial correlation, following Podsakoff and Organ (1986). More specifically, a partial least squares
(PLS) model was applied. The PLS included the highest factor from the principle component factor
analysis as a control variable on one dependent variable. This factor did not produce change in the
17
variance explained in one dependent variable, suggesting no existence of a significant CMV. The
third and final analysis was a single-method factor analysis. It was conducted by using the indicators
to measure the theoretical constructs and re-running the structural model, following Podsakoff et al.
(2003). The results did not change. All of these tests validated that common method bias is not a
major concern in this study.
5. Analysis and results

In this study, the PLS method was chosen to examine the proposed model and its hypotheses for
several reasons. The PLS is recommended for predictive research models, with emphasis on theory
development (Fornell and Bookstein, 1982). Given that this study was an initial attempt to advance a
theoretical model that determines the benefit and risk factors influencing Fintech behavioral intentions,
PLS was chosen due to its appropriateness for exploratory science (Chin, 1998).
Gefen et al. (2000) has recommended that a two-stage analytical process should be employed for a
data analysis. The measurement model was first assessed to determine how the observed items were
loaded on the constructs in the model. The assessment of the structural model could allow for
hypothesis testing by examining the relationships among the constructs. A Smart PLS version 3.00
was used for analyzing the measurement and structural models.
5.1 Measurement model
To validate our measurement model, three types of validity were assessed: content, convergent, and
discriminant. First, content validity refers to the representativeness and comprehensiveness of the
items used to create a scale (Straub et al., 2004). It is assessed by examining the process by which
scale items were generated (Straub 1989). The content validity of the instrument was established by
ensuring consistency between the measurement items and the extant literature by conducting several
rounds of pre-tests and pilot tests for the newly developed measures (Straub et al. 2004). After
following this process, our scales were found to be content-valid. Second, convergent validity was
assessed using Cronbach’s alpha, the composite reliability and the average variance extracted (AVE)
18
for each construct (Barclay et al., 1995). As shown in Table III (a), Cronbach’s alpha and the
composite reliability values were higher than the recommended level (0.7) (Nunnally, 1994). The
AVE values of our measures were higher than 0.5 (Fornell and Larcker, 1981), thus supporting
convergent validity. Finally, the discriminant validity of our instrument was verified by the square
root of the AVE (Fornell and Larcker, 1981). As shown in Table III (b), the results revealed that the
square root of the AVE of every construct on the measurement model was greater than the correlation
with the other constructs. The results of the inter-construct correlation revealed that each construct
shared a larger variance with its measures than with the other measures. Overall, the measurement
model was strongly supported by the gathered data and was suitable for further analysis.
The multicollinearity of all of the variables was assessed using variance inflation factors (VIFs).
Multicollinearity may potentially exist among the independent variables. Our results revealed that the
VIF values for the variables were acceptable, ranging from 1.458 to 1.884 (Petter et al., 2007). Such
results of the VIF test and the correlation indicated that multicollinearity was not a serious issue with
the research model proposed in this study, particularly if the purpose of the analysis was to make
inferences on the response functions or predictions of new observations (Neter et al., 1985).
Table III. Results of the measurement model analysis

(a) Assessment of reliability and validity
Average
Cronbach’s Composite
Construct Item variance Loading T-statistic
alpha reliability
extracted
PB1 0.723** 13.300
Perceived PB2 0.789** 26.737
0.786 0.862 0.610
benefit PB3 0.814** 23.957
PB4 0.795** 29.700
PR1 0.741** 14.580
Perceived
PR2 0.749 0.857 0.666 0.855** 37.874
risk
PR3 0.847** 28.848
EB1 0.921** 82.325
Economic
EB2 0.864 0.919 0.787 0.939** 108.831
benefit
EB3 0.800** 18.012
ST1 0.889** 54.775
Seamless
ST2 0.806 0.889 0.723 0.885** 48.434
transaction
ST3 0.695** 16.697
CV1 0.893** 54.659
Convenience CV2 0.905 0.941 0.841 0.931** 87.252
CV3 0.929** 113.125
FR1 0.755** 13.660
Financial risk FR2 0.793 0.878 0.707 0.882** 42.370
FR3 0.883** 39.507
LR1 0.819** 30.075
Legal risk 0.878 0.916 0.732
LR2 0.888** 60.567
19
LR3 0.877** 34.121
LR4 0.830** 22.135
SR1 0.910** 52.417
Security risk SR2 0.912 0.944 0.850 0.930** 86.674
SR3 0.920** 72.954
OR1 0.885** 44.707
Operational risk OR2 0.858 0.916 0.778 0.903** 63.689
OR3 0.864** 40.150
CI1 0.853** 16.971
Continuous CI2 0.886** 35.796
0.901 0.931 0.770
intention CI3 0.897** 51.822
CI4 0.871** 41.024
Note: ** p < 0.01
(b) Correlations and square root of AVE

Means
Construct 1 2 3 4 5 6 7 8 9 10
(S.D.)
5.109
1. Perceived benefit 0.781
(0.864)
3.894
2. Perceived risk -0.301 0.816
(1.005)
4.838
3. Economic benefit 0.616 -0.234 0.887
(0.974)
4. Seamless 4.764
0.580 -0.317 0.510 0.850
transaction (0.945)
5.266
5. Convenience 0.647 -0.364 0.572 0.589 0.917
(0.969)
4.203
6. Financial risk -0.222 0.539 -0.184 -0.179 -0.180 0.841
(0.928)
3.974
7. Legal risk -0.192 0.510 -0.106 -0.142 -0.242 0.493 0.856
(0.912)
4.609
8. Security risk -0.056 0.251 -0.101 -0.016 0.020 0.471 0.270 0.922
(1.089)
4.329
9. Operational risk -0.132 0.307 -0.081 -0.123 -0.123 0.364 0.402 0.623 0.882
(0.922)
10. Continuance 4.718
0.528 -0.285 0.383 0.506 0.562 -0.214 -0.226 -0.236 -0.302 0.878
intention (0.869)
Note: Numbers in the grayed diagonal represent each construct’s square root of average variance extracted;
5.2 Structural model
5.2.1 Hypotheses tests
With an adequate measurement model and a suitably low level of multicollinearity, all proposed
hypotheses were tested with the PLS. The path coefficients, t-values and R-squares were used to test
the structural model (Figure 2). The tests of significance of all of the paths in the research model were
conducted using the PLS bootstrap resampling procedure. As shown in Figure 2, all paths within the
model were supported at the 0.01 level. The proposed model accounted for 39.7% of the variance in
the Fintech continuance intention.
20
Note: *p<0.10, **p<0.05, ***p<0.01
Figure 2. Results of hypotheses tests for the total group
Figure 2 shows that the perceived benefit had a significant positive effect on the Fintech
continuance intentions (β=0.548, p<0.01). Thus, H1 was supported. The perceived risk was
negatively related to the Fintech continuance intention (β=-0.223, p<0.01), providing support for H2.
The perceived benefit positively affected the respondents’ willingness to continuously use Fintech,
whereas the perceived risk negatively influenced such willingness. The results also revealed that the
effect of the perceived benefit was greater than that of the perceived risk. This indicates that the
respondents were willing to use Fintech in Korea, in general.
The economic benefit, seamless transaction, and convenience had significant positive effects on the
perceived benefit (β=0.363, p<0.01; β=0.361, p<0.01; β=0.460, p<0.01), supporting H3, H4, and H5,
respectively. The path coefficient between the convenience and the perceived benefit was greater than
the causal relationships between the economic benefit, or seamless transaction, and the perceived
benefit. The path coefficient between the economic benefit and the perceived benefit was nearly
similar to the result between the seamless transaction and the perceived benefit.
The results also showed that the financial, legal, security, and operational risks had significantly
positive effects on the perceived risk (β=0.272, p<0.01; β=0.366, p<0.01; β=0.344, p<0.01; β=0.330,
21
p<0.01), providing support for H6, H7, H8, and H9, respectively. The highest loading of legal risk
indicated that it had the strongest impact on the perceived risk, whereas the financial risk had the
lowest impact. The effect of the security risk was greater than that of the operational risk on the
perceived risk. The proposed model accounted for 39.7% of the variance in the Fintech continuance
intentions.
5.2.2 Moderation test of Fintech user types

Fintech users were classified into two types, early adopters and late adopters based on the responses to
the new technology. The respondents were asked to choose the one statement that best described them
(Kim et al., 2010). Based on their responses, the respondents were classified into one of the two user
types, as shown in Table IV.
Table IV. Fintech user classification

User type Statement Reference
Early adopter I am willing to take risk Kim et al. (2010)
I am interested in new technology
I tend to be first in using new products and services
Late adopter I am hesitant to take risk Kim et al. (2010)
I still worry about new technologies
I tend to continue using existing products and services
The results of our user classification revealed that 66.3% of respondents were identified as early
adopters, while 33.7% of respondents were identified as late adopters. To investigate the differences
in the demographic characteristics between the two user groups, the age and education level were
analyzed. Table V illustrates that the early adopters had the following age distribution: 40 to 49 years
(26.7%); 30 to 39 years (24.8%); 20 to 29 years (24.2%); and ≥ 50 years (24.2%). Regarding
education level, 59.0% of early adopters had a bachelor’s degree, 11.2% had a master’s degree, 2.5%
had a PhD degree and 0.6% did not graduate from high school. The late adopters had the following
age distribution: 40-49 years (34.1%); 30-39 years (24.4%); ≥ 50 years (22.0%); and 20-29 years
(19.5%). Regarding education level, 63.4% of late adopters had a bachelor’s degree, while 22.0%
were college/associate degree graduates. The characteristics of the two groups were consistent with
the overall sample characteristics. The differences in the age and education level between the two
22
groups was not statistically significant (age: t=0.516, p=0.606; education level: t=0.356 p=0.724).
Based on these observations, individual differences and Fintech characteristics were further analyzed.
Table V. Characteristics of Fintech users

Early Late Early Late
Division Division
adopters adopters adopters adopters
Gender Male 77(47.8) 35(42.7) Fintech Type Mobile payment 44(27.3) 25(30.5)
Female 84(52.2) 47(57.3) Mobile remittance 50(31.1) 16(19.5)
Total 161(100) 82(100) P2P lending 28(16.8) 21(25.6)
Crowdfunding 40(24.8) 20(24.4)
Total 161(100) 82(100)
Age Under 20 0(0) 0(0) Education Under high school 1(0.6) 0(0)
20~29 39(24.2) 16(19.5) High school 22(13.7) 4(4.9)
30~39 40(24.8) 20(24.4) College/Associate 21(13.0) 18(22.0)
40~49 43(26.7) 28(34.1) Bachelor 95(59.0) 52(63.4)
50 over 39(24.2) 18(22.0) Master 18(11.2) 8(9.8)
Total 161(100) 82(100) PhD 4(2.5) 0(0)
Total 161(100) 82(100)
Each group underwent measurement model tests, such as exploratory factor analysis and
multicollinearity. Figures 3 and 4 show the results of the moderation test of the Fintech user type. As
shown in Figures 3 and 4, the relative importance of the benefit and risk factors varied, depending on
the user types. The effects of the perceived benefit and risk on the Fintech continuance intention were
only significant in the early adopter group. The effect of the perceived benefit (β=0.656, p<0.01) on
the continuance intention of the early adopters was significant, while that of the late adopters was not
significant.
The late adopter group indicated a stronger coefficient path (β=-0.309, p<0.10) of the perceived
risk than the early adopter group (β=-0.175, p<0.05). More specifically, convenience (β=0.449,
p<0.01) was the most positive factor. This was followed by seamless transaction (β=0.367, p<0.01)
and economic benefit (β=0.356, p<0.01). Legal risk had the most negative effect (β=0.413, p<0.01).
This was followed by operational risk (β=0.310, p<0.01) and security risk (β=0.309, p<0.0l) in early
adopters. Early adopters regarded financial risk as a low risk factor for using Fintech (β =0.261,
p<0.0l).
Regarding late adopters, convenience (β=0.530, p<0.01) had the highest impact on the perceived
benefit. This was followed by the economic benefit (β=0.381, p<0.01) and seamless transaction
23
(β=0.343, p<0.01). Security risk had the strongest negative effect (β=0.441, p<0.01) on the perceived
risk. This was followed by operational risk (β=0.388, p<0.01) and financial risk (β=0.288, p<0.01).
Legal risk had no significant effect on the perceived risk in late adopters. The perceived benefit and
risk accounted for 51.4% and 13.9% of the variance in Fintech continuance intention between early
and late adopters, respectively.

Note: *p<0.10, **p<0.05, ***p<0.01
Figure 3. Results of hypotheses tests for the early adopters
Note: *p<0.10, **p<0.05, ***p<0.01
Figure 4. Results of hypotheses tests for the late adopters
24
To statistically verify the differences in the user types, a multi-group comparison with PLS was
conducted (Qureshi and Compeau, 2009). The path coefficients and t-statistics generated with the PLS
between the early and late adopters are summarized in Table VI. A t-test was conducted to test the
significance of the difference between the early and late adopters. The results showed that there was a
significant difference in the effect of the perceived benefit on the Fintech continuance intentions
between the two groups (path coefficient difference=0.436, t=2.872, p<0.01), supporting H10.
However, there was no difference in the effect of the perceived risk between the two groups; as such,
H11 is not supported.
Moreover, the effect of legal and security risk on the perceived risk also showed a significant
difference between the two groups (path coefficient difference=0.251, t=2.924, p<0.01; path
coefficient difference=0.136, t=2.187, p<0.05). Overall, our results indicated that the significance of
the benefit and risk factors varied between the early and late adopters. The early adopters were willing
to continuously use Fintech, because they perceived that its benefits (β=0.656, p<0.01) were greater
than its risks (β=-0.175, p<0.05). However, late adopters were skeptical about making a continuous
usage decision, because they perceived that Fintech risks (β=-0.309, p<0.05) were strong, but not
beneficial. Security risk was the most critical reason for late adopters not to use Fintech.
Table VI. Multi-group comparison between early adopters and late adopters
Early adopters Late adopters
Path coeffi.
Relationship Path Path t-value p-value
T-statistics T-statistics Diff.
coefficient coefficient
PB→CI 0.656 12.120*** 0.220 1.218 ns 0.436 2.782 0.006***
PR→CI -0.175 3.055** -0.309 1.870* 0.134 0.923 0.357
EB→PB 0.356 13.802*** 0.381 3.180*** 0.025 0.252 0.801
ST→PB 0.367 13.196*** 0.343 6.433*** 0.024 0.453 0.651
CV→PB 0.449 14.817*** 0.530 5.634*** 0.081 1.001 0.318
FR→PR 0.261 10.313*** 0.288 5.101*** 0.028 0.511 0.610
LR→PR 0.413 12.871*** 0.162 1.593 ns 0.251 2.924 0.004***
SR→PR 0.309 11.882*** 0.441 6.695*** 0.132 2.187 0.030**
OR→PR 0.310 11.047*** 0.388 5.439*** 0.078 1.146 0.253
Note: ns=not significant, *p<0.10, **p<0.05, ***p<0.01
25
To further strengthen the validation of the proposed model and the hypotheses, we conducted an
ad-hoc test depending on the Fintech types, because the user motivations are still diversified. Four
Fintech types (i.e., mobile payment, mobile remittance, P2P lending and crowdfunding) were
employed to better understand the effect of the Fintech type-specific factors on Fintech usage, which
are sufficiently large to be significant. We then conducted four separate PLS analyses to test each
individually. The results of the ad-hoc test are shown in Table VII.
The effect of the perceived benefit on the continuous use of P2P lending was the highest, whereas
that of crowdfunding was the lowest. The effect of perceived risk was the greatest on the continuance
intention of mobile remittance. There was no effect of the perceived risk on the continuance
intentions of both mobile payment and P2P lending. These results indicate that P2P lending and
mobile payment users are actively willing to use their Fintech services. However, the users of mobile
remittance are the most concerned about their risk. The path coefficient difference between the
perceived benefit and risk was the smallest in crowdfunding, but was the biggest in both P2P lending
and mobile payment. Meanwhile, convenience was the strongest positive factor of the perceived
benefit for all Fintech types, whereas the most negative factor was different according to each Fintech
type.
Specifically, in terms of mobile payment, the effect of seamless transaction was high, while the
effect of financial risk was greater than that of the other risks. The mobile remittance user group
indicated a strong effect of seamless transaction on the perceived benefit, but the most negative legal
risk among the four risk factors. In the user group on P2P lending, the effect of the economic benefit
was an important factor to continuously use P2P lending. Legal risk was a main reason not to use P2P
lending. Financial risk had no significant impact on the perceived risk in P2P lending. The
crowdfunding user group illustrated that the economic benefit had the highest factor of perceived
benefit. Security risk had the most negative factor of the perceived risk. Positive and negative factors
accounted for 41.5%, 52.8, 53.7, and 31.9% of the variance in Fintech continuance intentions between
mobile payment, mobile remittance, P2P lending and crowdfunding, respectively.
26
Table VII. Results of ad-hoc tests between four types of Fintech
Path coefficient (t-value) R2
→
ST→ →
CV→
PB→CI PR→CI →PB
EB→ →PR
FR→ →PR
LR→ →PR
SR→ →PR
OR→
PB PB
Mobile
0.628** -0.091ns 0.337** 0.395** 0.430** 0.352** 0.330** 0.331** 0.303**
payment (6.501) (0.820) (9.074) (13.059) (13.443) (10.085) (2.898) (4.633) (6.132)
41.5
(N=69)
Mobile
0.514** -0.382** 0.360** 0.374** 0.470** 0.301** 0.356** 0.315** 0.277**
remittance (4.968) (3.819) (7.701) (6.946) (8.928) (8.581) (7.454) (7.828) (8.573)
52.8
(N=66)
P2P lending 0.741** -0.104ns 0.317** 0.307** 0.568** 0.102ns 0.410** 0.407** 0.348*
53.7
(N=48) (9.595) (0.670) (2.998) (5.872) (5.434) (1.001) (5.770) (4.388) (2.324)
Crowdfunding 0.398** -0.316** 0.439** 0.352** 0.401** 0.280** 0.318** 0.362** 0.357**
31.9
(N=60) (3.306) (2.804) (8.126) (9.321) (12.523) (6.105) (2.943) (5.000) (5.699)
Total 0.548** -0.223** 0.363** 0.361** 0.460** 0.272** 0.366** 0.344** 0.330**
39.1
(N=243) (10.292) (4.252) (16.312) (16.146) (16.846) (16.846) (10.617) (13.064) (12.473)
Note: ns=not significant, *p<0.5, ** p<0.01
6. Discussions and implications
6.1 Discussions of findings
Despite superior e-financial services in Korea’s financial industry, the Korean Fintech business is
not widespread, as compared to other countries (e.g., United States, United Kingdom, Singapore, and
China) because of the considerable uncertainty of the business environment. As Korea’s financial
sector is traditionally known for its stringent institutional control and high entry barriers, some
financial institutions and IT companies strongly doubt the business potential of Fintech so they are
eager to be convinced of Fintech’s business success. This study tried to help Fintech companies and
financial institutions by putting conviction into the customer demands for new Fintech services
through the investigation of Fintech usage behavior.
The purpose of this study was to determine both positive and negative factors jointly influencing
the continuous use of Fintech. To better understand Fintech usage behavior, Fintech users were
categorized into early and late adopters to investigate user-group level behavior. Our findings
revealed that the perceived benefit and risk significantly influenced the Fintech continuance intention.
However, they were not factored into the decision intention to the same extent. The results illustrated
that the perceived benefit had a much stronger impact on Fintech usage decision than the perceived
risk. This has significant implications, as benefits are more influential than risks in terms of users’
perception. Considering a high expected value of Fintech usage, more active development of Fintech
27
business by IT companies and a more pragmatic approach of institutional control by the government
are needed to meet user demands.
Among the three factors of perceived benefit, convenience was the strongest and most consistent
factor significantly affecting the perceived benefit. Our results indicated that Fintech users would
perceive Fintech usage primarily as a convenience that enables financial transactions mobility and
flexible access. This result is consistent with the results of previous studies (Kim et al., 2010; Kuo-
Chuen and Teo, 2015; Okazaki and Mendez, 2013; Shen et al., 2010). Fintech may even provide
greater convenience by reducing the effort and time that users invest in conducting financial
transactions. However, the Fintech continuance intention is not solely driven by convenience
improvements. Our findings illustrated that seamless transaction and economic benefit could also
drive the Fintech continuance intention.
Of the major risk factors driving the Fintech continuance intention, legal risk was the dominant
factor. This was followed by security, operational and financial risks. Fintech users were mainly
concerned about regulation and security issues that might be detrimental to users. For example, the
aggressive enforcement of anti-money-laundering statutes and money transmission regulations are
ongoing threats to Fintech businesses. Moreover, stringent institutional control by the government is
also a critical factor that inhibits Fintech businesses. As such, Fintech companies are struggling to
understand the financial act’s rules and regulations and how they apply financial transactions to their
services. These situations make users hesitant to engage in Fintech businesses. It leads users to form a
negative attitude towards using Fintech. Therefore, reforming the regulations and strengthening the
security of financial transactions should be considered to revitalize the Fintech business.
Unlike legal and security risks, the empirical data showed that financial risk had the weakest effect
among the four determinants of perceived risk. This result contradicts the results of previous studies,
showing that financial risk is the most significant factor of the perceived risk in mobile payment and
mobile banking usage (Abramova and Böhme, 2016; Liu et al., 2012; Luo et al., 2010). A possible
explanation for this intriguing result is that users might be more concerned with the other three
negative factors: legal, security and operational risks. This is because these three factors are
preconditions of financial risk.
28
Noteworthy differences in the specific benefits and risks effect were found between early and late
adopter groups. Convenience had the strongest positive impact on the perceived benefit, which, in
turn, increased the Fintech continuance intention in both groups, although it was regarded to be more
critical in late adopters. The effect of the economic benefit was the lowest among the three positive
factors in early adopters, whereas it was the most important positive factor in late adopters. The key
advantage of using Fintech by early adopters was not to have economic gains, but rather, seamless
transactions; this is a significant implication for Fintech companies. The results indicate that the early
adopters primarily seek the efficiency of financial transactions, while the late adopters seem to expect
more financial gains through using Fintech.
Interestingly, legal risk had the strongest significant effect on the Fintech continuance intention of
early adopters, although it had an insignificant impact on that of late adopters. As early adopters
usually have preliminary knowledge about the technology and business environments of Fintech, they
might have regarded the regulations applied to the Fintech business as a key barrier to Fintech usage.
However, the late adopters regarded security as the most critical risk factor among the four negative
factors, because they could not understand the specific legal environment of the Fintech business.
Their general thinking was that Fintech risk was like that of other technological services (e.g., online
banking, online shopping) in the IT industry.
Furthermore, considering the large gap in the perception of security risk between early and late
adopters, the difference between the two groups was significant. A possible explanation is that early
adopters might trust the reliability and stability of the Fintech technologies that they used (e.g.,
blockchain technology). However, late adopters might not be sure about the security of financial
transactions by IT companies. In addition, both groups expressed a strong concern about the effect of
the operational risk of the continuous use of Fintech. The results validated that Fintech users were
anxious about the lack of consumer protection and financial losses resulting from malfunctions or
security breaches by service providers’ systems and the process, regardless of their innovativeness.
Therefore, Fintech companies should enhance their reputation by establishing the stability and trust of
their system to attract more Fintech users.
29
6.2 Theoretical and practical implications
This study revealed several theoretical implications. First, this study attempts to empirically
examine a comprehensive set of perceived benefit and risk in the continuance intention towards
Fintech, an area of research that has not been addressed in previous studies. A more detailed
understanding of the continuous use of Fintech in the IS field must be achieved before more
significant progress can be made. Therefore, this study proposed the benefit-risk framework for the
continuous use of Fintech from the IS literature. Furthermore, the theoretical and empirical validation
of the effects of the perceived benefit and risk for Fintech usage is also a significant research
contribution of this study.
Second, this study contemplates the specific benefit and risk factors jointly influencing the Fintech
continuance intention. This study reveals specific benefits and risks contributing to the formation of
the continuance intention and the extent to which they contributed. By using multi-dimensional
concepts of benefit and risk, this study observed the individual effects of the underlying determinants
and assessed the overall impact of the benefit and risk on the Fintech continuance intention. Moreover,
this study advances our understanding of the process of balancing different salient beliefs regarding
the benefit and risk factors prior to the decision-making process, so that the decision-making process
of Fintech usage becomes more transparent and traceable.
Third, this study indicates that the effects of the perceived benefit and risk on the Fintech
continuance intention are different, depending on the user types. The speed of diffusion of an
emerging service with new technologies depends on the characteristics of the service, as well as the
characteristics of the user (Teo et al., 2008). This study focused on the difference of specific benefit
and risk factors influencing the continuous use of Fintech between early and late adopters. The
difference between the benefit and risk factors was empirically validated. User-specific factors are
major contributors to the success of the Fintech business, which, in turn, leads to better Fintech usage.
This study reveals several practical implications. First, this study highlights that the perceived
benefit is more influential than the perceived risk of the Fintech continuance intention. The findings
also implied that users were willing to continuously use Fintech, in general, although the considerable
risk factors still existed in the market. From the results of the ad-hoc analysis as shown in Table VII,
30
users perceived high benefits, but no risks in P2P lending, despite the Lending Club scandal. The
interpretation about the strong positive perception in P2P lending seems to be consistent with the
reckless investment craze of Bitcoin in 2017. Users’ strong positive perceptions of Fintech, without
risk perceptions, might lead to the serious financial trouble of Fintech users in the short term, and the
destruction of Fintech business ecosystems in the long term. Thus, our findings need to be carefully
interpreted. If users simultaneously perceive both the benefits and risks of Fintech, the users’
decision-making process can work properly and the Fintech business can be consistently developed
and enhanced. For the reason, building a risk-free transaction environment is much more important
than providing benefits to users to enhance Fintech businesses for the long term. Fintech companies
should search for risk-reducing strategies that may assist in inspiring higher levels of confidence in
potential users.
Second, this study provides Fintech managers with valuable insight on the factors they should
emphasize or avoid when marketing Fintech to users. The empirical results revealed that the three
benefit and four risk factors had a significant effect on the behavioral intention of Fintech. In terms of
perceived risks, legal risk had the most negative effect for the total group. Both early and late adopters
considered operation risk to be most crucial factor in their reluctance to use Fintech. According to our
findings, the possible risk-mitigation strategies of Fintech companies may involve developing detailed
contracts with Fintech users. These contracts may include mandatory security standards (e.g.,
blockchain technology), penalties, and compensation for data breaches or non-performance by a
system-caused failure, as well as the inclusion of third parties. The third parties are responsible for
guaranteeing the availability and integrity of the data (e.g., credit evaluation) and safeguarding users
against major risks (e.g., bankruptcy). In terms of perceived benefits, Fintech companies should make
an effort to provide their users with economic gains and the efficiency of financial transactions at the
same time. This finding is particularly significant for Fintech managers that need to decide how to
allocate resources to retain or expand the current user base. Hence, this study provides valuable
practical guidance to managers to enhance the Fintech continuance intention.
Third, Fintech managers should understand the clear differences between benefit and risk factors,
depending on the user types. Such a distinction can enable Fintech companies to understand the
31
characteristics of each Fintech user and effectively deliver services, while meeting customer
expectations and demands, thereby improving the continuous use of service. Our findings show that
the early adopters mainly focus on the efficiency of financial transactions, whereas the late adopters
seek more financial gains through Fintech usage. Moreover, the early adopters are concerned about
the legal risk, while the late adopters consider security risk as the most negative factor. Therefore,
Fintech companies should consider their users’ characteristics before the positive and negative factors
for Fintech usage are realized in the market. Our findings will help Fintech companies invest an
appropriate amount of time, effort, and money in the development and provision of Fintech.
6.3 Limitations and future research directions
Despite the previously mentioned contributions, this study has a few limitations, several of which
offer opportunities for future research. First, this study focused on a specific set of perceived benefits
and risks reflecting those used in the previous studies. Future studies may include other factors of
benefit and risk associated with the continuous use of Fintech that might start to show significance
over time. Second, this study did not incorporate actual usage behavior into the proposed model.
However, substantial empirical support has existed, regarding the causal link between the intention
and usage behavior (Venkateshand Davis, 2000).
Third, due to the innovative nature of Fintech and its infancy stage of implementation, this study
focused on behavioral intention, as a dependent variable, to interpret the theory-driven behavior in the
early adoption stage. Measurement reliability needs to be improved in future research by applying
additional methods (e.g., field studies, longitudinal analysis) to more closely observe and investigate
the differences between early and late adopters in the later stages of Fintech implementation. Fourth,
the respondents of this study were limited based on four types of Fintech: mobile payment, mobile
remittance, P2P lending, and crowdfunding. Therefore, our findings might not be applicable to other
Fintech applications (e.g., Bitcoin, Ethereum, Internet insurance, personal financing, equity financing,
retain investment, Fintech tool and software). Hence, future research is needed to extend this
investigation to other Fintech services.
32
Finally, our findings might not be applicable, in a general sense, to future studies, because our
sample was restricted to Korea, with different national characteristics, compared to other Fintech
technology advancing nations (e.g., United States, United Kingdom, China, and Singapore). Therefore,
the results of this study must be cautiously interpreted. Future studies considering national
characteristics are needed to explain the issue of Fintech usage across different nations at the
individual level.
Acknowledgements
This work was supported by the Ministry of Education of the Republic of Korea and the National
Research Foundation of Korea (NRF-2016S1A5A8017092) and by the Ministry of Science, ICT &
Future Planning of the Republic of Korea under the National Program for Excellence in Software
(R2215−16−1005) supervised by the IITP (Institute for Information & communications Technology
Promotion).
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Author’s Biography
Hyun-Sun Ryu is a Visiting Professor of Software Department in the Software College of

Sungkyunkwan University in Seoul, Korea. She holds M.S. degree from the Graduate School of
Management, Korea Advanced Institute of Science and Technology (KAIST) and Ph.D. degree
from the Korea University Business School, both in management information system, in 2005 and
2014, respectively. Her work experience includes serving as a Software Engineer and Senior
Researcher for the Samsung Electronics Co., Ltd., and the Korea Government Institute for
36
Economics and Trade. Her research interests include management of innovation through
combining services with technology or with IT, their impact on organizational performance and a
new role of IT in Fintech. Her published research articles appear in Information & Management,
IEEE Transactions on Engineering Management, Service Industries Journal, Information Journal,
and others
37
APPENDIX: STRUCTURE OF THE SURVEY INSTRUMENT
Constructs Questionnaire Reference
Perceived benefit PB1. Using Fintech has many advantages. Kim et al. (2008)
(PB) PB2. I can easily and quickly use Fintech Benlian and Hess
PB3. Using Fintech is useful for me (2011)
PB4. Using Fintech yields a more superior outcome quality than
traditional financial services.
Perceived risk PR1. Using Fintech is associated with a high level of risk. Kim et al. (2008)
(PR) PR2 There is a high level of uncertainty using Fintech Benlian and Hess
PR3. Overall, I think that there is little benefit to use Fintech (2011)
compared to traditional financial services.
Economic benefit EB1. Using Fintech is cheaper than using traditional financial Featherman and
(EB) services. Pavlou (2003),

EB2. I can save money when I use Fintech. Lee (2009)
EB3. I can use various financial services with a low cost when I use
Fintech.
Seamless ST1. I can control my money without the middleman when I use Chishti (2016)
transaction Fintech.
(ST) ST2. I can use various financial services at the same time (e.g., one
stop processing) when I use Fintech.
ST3. I can have the peer-to-peer transactions between providers and
users without middle man when I use Fintech.
Convenience CV1. I can use financial services very quickly when I use Fintech. Okazaki and
(CV) CV 2. I can use financial services anytime anywhere when I use Mendez (2013)
Fintech.
CV 3. I can use financial services easily when I use Fintech.
Financial risk FR1. Financial losses are likely when I use Fintech. Featherman and
(FR) FR2. Financial fraud or payment frauds are likely when I use Pavlou (2003),
Fintech. Lee (2009)
FR3. Financial losses due to the lack of the interoperability with
other services are likely when I use Fintech.
Legal risk LR1. My use of Fintech is uncertain due to many regulations. Barakat and
(LR) LR2. It is not easy to use Fintech due to the government regulation. Hussainey (2013),
LR3. There is a legal uncertainty for Fintech users. Abramova and
LR4. It is difficult to use various Fintech applications due to the Böhme (2016)
government regulation.
Security risk SR1. I worry about the abuse of my financial information (e.g., Featherman and
(SR) transaction and private information) when I use Fintech. Pavlou (2003),
SR2. My financial information is not secure when I use Fintech. Lee (2009)
SR3. I worry that someone can access my financial information
when I use Fintech.
Operational risk OR1. Fintech companies are not willing to solve the issues when Barakat and
(OR) financial losses or financial information leakages occur. Hussainey (2013)
OR2. The organizational responses of Fintech companies are too
slow when financial losses or financial information leakages
occur.
OR3. I worry about the way Fintech companies respond to financial
losses or financial information leakages.
Continuance CI1. I would positively consider Fintech in my choice set. Cheng et al.
intention CI2. I would prefer Fintech. (2006), Lee
(CI) CI3. I intend to continue to use Fintech. (2009)
CI4. I will use Fintech in the future.
38

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risks of continuance intention differs depending on user types.

impacts are found between early and late adopters.

risk factors affecting the Fintech continuance intention.

framework, User Type.

Paper type – Research paper

differentiated financial services offered by non-financial providers.

these costs and achieve long term success.

people continue to use Fintech.

the theory of reasoned action (TRA) (Ajzen and Fishbein, 1977).

questions motivated this study:

should be prioritized or avoided when offering Fintech to their users.

(2015) defined Fintech as products or services in non-financial institutions created on highly

services to mobile environments.

substituting the existing channel.

payment, mobile remittance, P2P lending and crowdfunding1.

2.2 Benefit-risk framework

Fintech continuance intention.

dimensional manner (i.e., security/privacy, financial, social, time/convenience, performance risks),

managerial risks) associated with SaaS adoption.

risk, and adoption risk) were included in their study.

Table I. Benefit-risk framework of IT service adoption and usage

-Cost advantage -Performance risk

Investigated the mobile -Financial risk

-Self-clarification -Security risk

Analyzed users’ social -Social benefit -Social risk

2.3 Early adopters vs. late adopters

expectations and demands, thereby improving the continuous use of Fintech.

categories are considered: early and late adopters.

Figure 1. Research model

3.1 Benefit-risk framework for the continuous use of Fintech

they are willing to take risks to reap gains or benefits.

negatively influence bitcoin use.

Consequently, the following hypotheses are developed:

H1: Perceived benefit is positively related to Fintech continuance intention.

H2: Perceived risk is negatively related to Fintech continuance intention.

(Gerber et al., 2012; Lee and Lee, 2012).

business ecosystems of the financial services industry.

continuance intention. As such, this study has the following hypotheses:

H3: Economic benefit is positively related to perceived benefit.

H4: Seamless transaction is positively related to perceived benefit.

H5: Convenience is positively related to perceived benefit.

3.3 Risk factors for the continuous use of Fintech

negatively related to the intention of continuous use.

example, Korean government aggressively intervenes in the management of Korean financial

distrust and anxiety.

al., 2010); this also increases the perceived risk of Fintech.

Consequently, this study proposes the following hypotheses:

H6: Financial risk is positively associated with perceived risk.

H7: Legal risk is positively associated with perceived risk.

H8: Security risk is positively associated with perceived risk.

H9: Operational risk is positively associated with perceived risk.

3.4 Moderating effect of user type

have been developed:

literature review. Comprehensive multiple-item measures were developed based on previous

used and the relevant studies are shown in the Appendix.

4.2 Sample and data collection

they were not allowed to participate in the survey.

Note: p<0.10, p<0.05, p<0.01

Note: p<0.10, p<0.05, p<0.01

Note: p<0.10, p<0.05, p<0.01