Factors Affecting the Prevalence of Electronic Transaction in Ethiopia
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Date
2024-06-30
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A.AU
Abstract
The Ethiopian economy has been growing at an impressive rate over the last few decades.
Although commercial transactions have grown as a result of the economic growth, electronic
transactions have not shown similar level of growth; especially when compared to peer
developing nations. This study was conducted with the main objective of identifying and
measuring the major factors which affect the prevalence of electronic transactions in Ethiopia.
Data collected through questionnaire distributed to respondents in Ethiopia was used in this
study. The major factors identified as independent variables are existence of adequate
telecommunication infrastructure to support electronic transactions, awareness of availability of
electronic transactions, availability and use of electronic payment system services, digital
literacy, and perceived legal protections for electronic transaction users. Multiple linear
regression model was used to measure or analyze the effect of the independent variables on the
dependent variable, prevalence of electronic transactions in Ethiopia. The study found that each
of the major factors identified have significant effect on the prevalence of electronic transactions
in Ethiopia. In particular, this study found that digital literacy among e commerce customers is
the most significant factor which affects the number of electronic transactions in Ethiopia, with
one unit increase in digital literacy having a 0.424 effect on the dependent variable. The
existence of adequate telecommunications infrastructure to support electronic transactions and
availability and use of electronic payment system services also significantly affect the prevalence
of electronic transactions in Ethiopia, with one unit increase in each of these variables
representing a 0.211 and 0.146 increase in the dependent variable respectively. Finally,
awareness of availability of electronic transactions and perceived legal protections for
electronic transaction users was also found to significantly affect the prevalence of electronic
transactions with one unit increase in each of these factors respectively representing a 0.088 and
0.085 increase. The study shows that positive interventions in each of these factors by the
government and all relevant stakeholders will have a positive impact on the prevalence of
electronic transactions in Ethiopia.