Determinants of Mobile Payment Adoption by Businesses: An Empirical Study Using the Perceived E-Readiness Model (PERM)

Abstract

The digital transformation of financial ecosystems has accelerated in recent years, with mobile payment systems emerging as a cornerstone of modern commerce. While much of the existing research has emphasized consumer adoption of mobile payments, the determinants that drive businesses to adopt and integrate these systems remain comparatively underexplored. Businesses, as critical stakeholders in the payment ecosystem, not only influence consumer usage but also shape the broader trajectory of financial inclusion and digital economy growth. Against this backdrop, this study applies the perceived e-readiness model (PERM) to investigate the factors influencing business adoption of mobile payment solutions. The model emphasizes organizational readiness for the adoption of mobile payments and studies both internal and external readiness factors that impact the adoption of mobile payment technology. The internal readiness is accessed by perceived organizational e-readiness (POER) constructs like awareness, human resource, business resource etc., and the external readiness is accessed by the readiness of the Government, market forces, and the readiness of the competitors. The study was conducted on 144 businesses spanning multiple sectors. The data was collected through a survey using a questionnaire on a Likert scale. The data was analysed by employing partial least squares structural equation modelling. The findings reveal that awareness, human resources, and strategic alignment are the most critical enablers of mobile payment adoption among businesses. While external ecosystem factors (government, market forces, and support industries) matter, the readiness and commitment of the businesses themselves through informed leadership, skilled employees, and strategic planning play the dominant role. The study contributes to both theory and practice by extending the application of PERM to the context of digital financial services and offering actionable recommendations for policymakers, technology service providers, and business managers.