Customer adoption of green banking: an extended theory of planned behavior

Purpose Green banking has evolved in the financial sector to reduce the negative impact of economic progress. However, customers’ behavior remains indifferent towards bank’s green initiatives across nations. Therefore, this study examines the various factors affecting the behavior of Indian banking customers towards green banking by extending the theory of planned behavior (TPB). Design/methodology/approach The study employed a quantitative research approach and distributed a self-administered questionnaire. Data from the 293 green banking service users in India’s Delhi-National Capital Region (NCR) have been collected using purposive and snowball sampling techniques. SPSS 26 and SmartPLS 3 were used to analyze data. Findings The findings explained that environmental concern substantially predicts customer attitude, subjective norms and perceived behavior control towards green banking. Moreover, all the constructs within the TPB model were found to substantially impact customers’ inclination to adopt green banking, thereby leading to actual behavior. Research limitations/implications Academically, the findings have broadened the TPB model’s application by adding a new construct in the context of green banking while confirming its applicability. Practically, it advises financial regulators and banking personnel to prioritize establishing a conducive environment for customers, characterized by the accessibility of green banking services under favorable conditions and at affordable rates. Originality/value The study enhanced the understanding towards green banking by correlating different variables and extending the TPB model using SmartPLS 3 in the domain of green banking.