Emergence of information technology (IT) in the banking industry has given impetus to Internet Banking (IB). Since the new millennium, IB has experienced explosive growth in many countries including India. Statistics show that in the state of Kerala too, increasingly, banking customers have started to use IB, and it is felt that there is a need for research to understand the perceptions of IB users. The current study gains relevance in this context and it is carried out with the specific objective of understanding the perceptions of IB users in Kerala, using technology acceptance model (TAM) by incorporating service quality as the external variable. Service quality dimensions such as fulfilment, efficiency, reliability, website attributes, responsiveness, and privacy have been used as antecedents to the twin TAM constructs: perceived ease of use (PEOU) and perceived usefulness (PU), and the effect of these constructs on IB use is investigated using the data collected from 406 IB users from the state of Kerala, India. The results of Structural Equation Modelling (SEM) revealed that both the TAM constructs have a direct effect on IB use, and PEOU has an indirect effect via PU. Service quality dimensions also have indirect effect through TAM constructs on IB use. The empirical validation of a modified TAM with service quality as the external variable to predict IB use in Kerala is an important theoretical contribution of this study. One of the limitations of this paper is that its scope is limited to Internet Banking users of Kerala which in turn affects the generalisability of the findings. However, the findings are useful insights to global markets as IB defies geographical barriers.
