Platform-based mobile payments adoption in emerging and developed countries: Role of country-level heterogeneity and network effects

Platform-based payment services such as mobile wallets (Mwallet) provide a unique value proposition to both customers and firms over other digital payment methods. Interestingly, the story of platform-based mobile payments adoption is unfolding differently across countries, with some emerging countries (China and India) outperforming developed countries. Using extant literature in International Business/International Marketing, industry reports, and qualitative interviews, we present a conceptual framework for mobile payments adoption at an aggregate level for customers and retailers. We present a set of hypotheses and derive the explanations using the literature on network effects and institutional theory. We test our framework on a diverse set of 30 countries and confirm the presence of network effects and the differential impact of perceived value, inertia, and culture on the adoption level of innovators and imitators. Importantly, we find a significant level of within- and between-country heterogeneity for mobile payment adoption, which provides further evidence for leapfrogging by emerging countries in the context of the mass adoption of mobile payments. These findings have significant implications for theory and practice in multinational organizations.