Factors Affecting the Usage of Mobile Banking service in Ethiopia, in case of Dire Dawa City

The purpose of this study is to examine factors affecting the usage of mobile banking services in Ethiopia, in case of Dire Dawa City. This study adopted a quantitative research approach by using a primary data source. Descriptive and explanatory research design was used for this study. And to determine the sample size, Yemane (1967) formula was applied by using non probability sampling technique specifically convenience sampling technique was used. The study tries to build on two widely used models, the Technology Acceptance Model (TAM) and Innovation Diffusion Theory (IDT) and to identify factors affecting the usage of mobile banking service. A research model uses the TAM model and IDT model by integrating perceived risk, trust and awareness into the established models. This study was conducted based on the data gathered from customers of six Commercial Banks in Dire Dawa City. Survey was conducted using questionnaire. Out of 399 questionnaires that have been distributed, 374 were responded. The analysis of the data was done with the help of the SPSS and Stata. The research results found relative advantage, perceive usefulness, perceived ease of use, compatibility, perceived trust, and perceived risk as main affecting factors for mobile banking usage whereas awareness were found to have insignificant effect on mobile banking usage for bank customers located in Dire Dawa. The study recommended banks to consider investing in campaigns and arranging information sessions to demonstrate the features of mobile banking services, and its benefits over traditional channels.