Exploring the Determinants of Digital Banking: Perspective on Barriers to Change

Digital transformation is an important trend for business development in the industrial revolution 4.0 and is an irreversible development trend. Development of digital banking, therefore, is also an inevitable trend. However, the transformation process from traditional banks digital banks in Vietnam is still very new and faces many barriers. Based on the Technology-Organization-Environment (TOE) model, this study proposes a hierarchical model including three main dimensions and eleven sub-dimensions to assess the barriers affecting the digital transformation of banks in the emerging market. Analytical hierarchy process (AHP) is used to rank relative comparisons to uncover the determinants of digital transformation adoption for commercial banks in Vietnam. The results show that the relative importance of technological barriers is the largest (0.574), followed by organizational barriers (0.290) and environmental barriers (0.136). These results imply that in order to gain relative competitive advantage, banks should pay attention on removing technological barriers as well as support resources for digitalization and prepare strategy to deal with the complexity of technology and operating environment.