Virtual Bank Usage Intention in Hong Kong: Exploring System Quality, UI Design, Security, Service Quality, Utilitarian Expectations, Word-of-Mouth, Brand Image and Rewards

Abstract

The rapid development of fintech has led to the emergence of virtual banks (also known as neobanks, challenger banks, digital banks, or online-only banks). These new banks, by eliminating physical branches, reducing costs, and offering convenient and innovative user experiences, are transforming traditional banking. In Hong Kong, nearly four years since its launch, virtual banks have amassed 2.2 million users but face intense competition and multiple challenges while also presenting significant growth opportunities. Analyzing target customers’ usage intentions and related factors is crucial for enhancing service quality, market strategies, customer relationships, and innovation. This study explores the impact of system quality, user interface, security, service quality, utilitarian expectations, word of mouth, brand image, and reward systems on user intentions. Using a triangulation method that combines literature review, focus groups, pilot surveys, and large-scale surveys, 259 valid questionnaires were collected via snowball sampling and analyzed using SPSS. The results show significant correlations for all eight hypothesized factors. The research aims to provide insights and recommendations for the industry to improve overall service quality and increase market share, benefiting all stakeholders.