Factors influencing adoption of QR code payment system: a study based in northern province, Sri Lanka

Abstract

Despite initiatives to promote digital financial solutions, the adoption of QR code payments among small vendors in Sri Lanka remains limited, particularly in the Northern Province, compared to more developed countries and regions within Sri Lanka, such as the Western Province. This gap persists despite the introduction of LankaQR by the Central Bank of Sri Lanka, which aims to facilitate digital transactions among SMEs through integration with popular payment applications. The transition to digital financial solutions has been accelerated by the COVID-19 pandemic and persistent economic challenges. Hence, this research aims to identify the " factors that affect small vendors in Sri Lanka in adopting QR code payment in Jaffna, Sri Lanka. The study adopts a qualitative research design and interpretivism approach, utilizing a purposive sample of 12 small vendors in Jaffna. The study used to gather data and analyze it using thematic to identify key determinants of behavioral intention toward adoption of QR payment. This study found that QR code payment adoption among small vendors in Jaffna is limited due to three main factors. Technological barriers include low digital literacy and unreliable internet connectivity. Behavioral factors involve perceived complexity, distrust, and fear of fraud. Socio-economic constraints, such as cash dependence, credit-based practices, and transaction costs, further restrict adoption, with cultural norms and generational differences reinforcing reliance on cash. The findings indicate that enhancing digital infrastructure, fostering trust through education, offering incentives, and engaging communities are vital for sustainable QR payment adoption in Sri Lanka.