Effectiveness of Cybersecurity Measures in Building Customer Trust in Digital NBFC Services

Background: As digital adoption accelerates in India’s Non-Banking Financial Company (NBFC) sector, customer trust becomes a pivotal factor in ensuring continued usage of online financial services. Despite technological advancements in cybersecurity, trust deficits persist due to low user awareness and variable digital experience. This study investigates the role of perceived cybersecurity effectiveness (PCE) in building customer trust (CT), with attention to mediating and moderating factors such as awareness of cybersecurity features (ACF), prior digital experience (PDE), and demographics.

Methods: A quantitative, cross-sectional research design was employed. Data were collected from 384 NBFC customers across urban, semi-urban, and rural regions in India using a structured questionnaire. Constructs were measured using validated Likert-scale items. Data were analysed using Structural Equation Modelling (SEM) via AMOS, with additional tests for mediation and moderation effects.

Results: PCE had a significant positive effect on CT (β = 0.49, p < 0.001). ACF partially mediated the relationship between PCE and CT (β = 0.21, p < 0.01), while PDE positively moderated the PCE–CT relationship (β = 0.13, p < 0.05). Demographic factors, particularly digital literacy and education, significantly influenced how customers perceived cybersecurity and formed trust.

Conclusion: The findings underscore that cybersecurity effectiveness must be matched by user awareness and tailored communication to build meaningful trust. NBFCs should prioritize not only technical security infrastructure but also user education and transparency strategies to foster trust in digital environments.

Cybersecurity, Customer Trust, NBFC, Digital Literacy, Structural Equation Modelling

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