The impact of COVID-19 on consumer behavior in retail banking. Evidence from Romania

Abstract

The pandemic COVID-19 has severely affected the global economy. The strict lockdown measures have also changed the daily live, including consumer behavior in retail banking. In this context, the purpose of this paper is to investigate the impact of the COVID-19 crisis on consumer behavior in retail banking, with a special focus on the Romanian banking sector. To achieve our goal, we performed a survey among the Romanian consumers in retail banking, using as research method the field survey based on questionnaire. The final sample comprised 738 valid responses from the metropolitan area retail banking consumers. The research brings a fresh insight on retail banking services consumption during the pandemic and validates a conceptual model regarding the internet and mobile banking services acceptance. The research’ results highlighted, among others, that the variable concerning the perception of the COVID-19 pandemic effect on consumers’ lifestyle has a direct and positive influence on the variable regarding the attitude toward internet and mobile banking services, mediated by other variables like safety of internet and mobile banking use and trust in banks. Several social and managerial implications are also discussed, because it is possible that the tendency to use internet and mobile banking services will prevail even after the post pandemic stage, as new consumption behavior models are developing. Banks in Romania should increase their initiatives to offer financial education courses and online tutorials to familiarize customers with the use of digital channels. Banks should also improve communication with clients and design new products and services to increase the attractiveness of saving process. They should demonstrate flexibility in negotiating lending and refinancing conditions as well.

Implications of the COVID-19 pandemic on market orientation in retail banking

“…In general, our study shows that COVID-19 has become a major driver of digital transformation in retail banks. This aligns with Baicu et al ( 2020 ), who found a strong increase in the consumption of mobile and Internet banking during the pandemic. As mentioned in introduction, Finnish banks can be seen as forerunners in digitalization and adjusting delivery channels, which prepared employees and customers in the Finnish banking sector for the change and helped them easily adapt to remote services.…”

COVID-19, consumer behavior, technology, and society: A literature review and bibliometric analysis

“…Considering the prevalence of TPB and TAM, and their variants in consumer studies prior to COVID-19 (particularly regarding technologies) coupled with the massive popularity of technologies during the pandemic ( Baicu et al., 2020 : Sheth, 2020 ), the dominance of the two theories in this study is not surprising. Furthermore, they also explain the popularity of quantitative methods in the selected studies, and by specifying a set of directional relationships, they allow for testing the proposed models via structural equation modeling ( Kline, 2016 ).…”

“…High importance is attached to COVID-19, the technological environment, and the politico-legal environment. Various studies indicate how the COVID-19 and available technology confluence has induced consumers to massively and rapidly adopt technologies and increase their consumption of highly digital business formats ( Baicu et al., 2020 : Sheth, 2020 ). Specifically, e-commerce and business platform formats solved possible shortage problems and allowed consumers to accumulate products ( Hao et al., 2020 ; Pillai et al., 2020 ).…”

The Impact of the Crisis Triggered by the COVID-19 Pandemic and the Actions of Regulators on the Consumer Finance Market in Poland and Other European Union Countries

“…When it comes to the protection of consumer rights within the EU, the European Commission and the governments of individual member states took very decisive actions. In the first stage of the crisis, numerous-often comparable-ad hoc measures were introduced in order to guarantee a higher level of security to people who lost their sources of income or those whose economic situation deteriorated (Baicu et al 2020).…”