CUSTOMERS INTENTION TO USE ARTIFICIAL INTELLIGENCE IN BANKING SECTOR

Abstract

Artificial Intelligence (AI) is reshaping industries worldwide, particularly in banking, where it offers personalized services, enhances efficiency, and improves customer experiences. In Kathmandu valley, Nepal, AI adoption in banking is on the rise. This study aims to explore customers' intentions to utilize AI in banking within Kathmandu valley, shedding light on the factors that influence their adoption behavior. A mixed-method approach, combining surveys and interviews, was employed to collect data from banking customers within Kathmandu valley. The survey questionnaire was designed based on established constructs from the TAM and tailored to the Nepalese context. Interviews complemented the quantitative data by offering qualitative insights into customers' perceptions and attitudes towards AI in banking. Analysis of survey data revealed several significant findings. Firstly, perceived usefulness and optimism emerged as primary drivers influencing customers' intentions to adopt AI-based banking services. Trust in AI systems, security concerns, and perceived risks also played crucial roles in shaping adoption behavior. Additionally, demographic variables such as age, income, and education level were found to impact customers' attitudes towards AI in banking. Qualitative insights from interviews corroborated these findings, providing deeper context and understanding. This study contributes valuable insights into customers' intentions to use AI in the banking sector within Kathmandu valley. By identifying key determinants and barriers to adoption, it provides actionable recommendations for banks and policymakers aiming to leverage AI technology effectively. Addressing concerns related to trust, security, and usability is paramount for fostering greater acceptance of AI-based banking services among customers in Nepal.