“We Do What Everyone Else is Doing” – Investigating the Herding Behavior of Mobile Payment Users

As the technologically advanced unified payment interface (UPI), enabling cross-bank mobile payment transactions, was launched in India, mobile payment’s popularity in the country grew multi-fold. However, contrary to what mobile payment usage literature suggests about technology features driving usage, we posit that common users often lack the understanding of the detailed technical features and are predominantly driven by what everyone else does – i.e., the herding behavior. Motivated by this, we examine the types of herding – rational and irrational. We develop a research model comprising multi-dimensional scales to capture herding behaviors that impact mobile payment continuance usage. We validated the herding-focused research model using the survey responses from 507 users. The study contributes to the field significantly by adding elements from herding behavior theory to the literature on mobile payment usage, which is of significant value owing to the networked nature of the technology. The results show that there is a balancing influence of rational and irrational herding on continuance usage, which has implications for practice for controlling for certain herding factors to promote technology’s popularity.