The relationship between credit card attributes and the demographic characteristics of card users in China

2016 ◽  
Vol 34 (7) ◽  
pp. 966-984 ◽  
Author(s):  
Christopher E.C. Gan ◽  
David A. Cohen ◽  
Baiding Hu ◽  
Minh Chau Tran ◽  
Weikang Dong ◽  
...  
Keyword(s):  
Interest Rates ◽  
Credit Card ◽  
Credit Cards ◽  
Structured Interview ◽  
Application Process ◽  
Content Type ◽  
Explanatory Variables ◽  
The Impact ◽  
The Relationship ◽  
Different Levels

Purpose The purpose of this paper is to investigate the impact that several of these factors have on a consumer’s decision to hold a credit card, as well as those involved in determining the level of credit card limit. Design/methodology/approach Potential explanatory variables were identified in the literature, then used to build a binary logit model to test the impact of the card and consumer characteristics on credit card ownership. Data were collected via a structured interview of 409 consumers living in Hebei Province, China. Findings The results indicate that convenience in use, level of credit card interest rates, the application process, number of people in the household, a rewards programme, marital status, credit limit and age influence the likelihood of the respondent holding a credit card. Further, an anaylsis shows that the number of credit cards held, duration of holding a credit card, monthly credit card purchasing volume and having a degree at the tertiary level, are significantly and positively related to different levels of credit limit. Originality/value In summary, in order to attract more consumers to credit card use, the banks and credit card companies should consider making it more convenient for consumers to use their credit cards. Moreover, banks can increase their networking and degree of cooperation with merchants to increase the acceptance of payment by credit card. The most heavily used businesses such as supermarkets and smaller retailers, where consumers purchase goods frequently, would be good targets for banks’ attention. In addition, banks might also improve credit card reward programmes to make these more efficient and perhaps increase the size of the rewards customers can earn through card use.

Does knowing overcome wanting? The impact of consumer knowledge and materialism upon credit card selection with young consumers

2015 ◽  
Vol 16 (1) ◽  
pp. 50-70 ◽  
Author(s):  
Jakob Cakarnis ◽  
Steve Peter D'Alessandro
Keyword(s):  
Comparative Study ◽  
Survey Research ◽  
Credit Card ◽  
Design Methodology ◽  
Credit Cards ◽  
Consumer Knowledge ◽  
Content Type ◽  
Young Professionals ◽  
The Impact ◽  
Selection Of

Purpose – This paper investigates the determinants of credit card use and misuse by student and young professionals. Critical to the research is the impact of materialism and knowledge on selection of the appropriate credit card. Design/methodology/approach – This study uses survey research and partial least squares to investigate credit card behaviors of students versus young professionals. Findings – In a comparative study of young professionals and students, it was found that consumer knowledge, as expected, leads to better consumer selection of credit cards. Materialism was also found to increase the motivation for more optimal consumer outcomes. For more experienced consumers, such as young professionals, it was found that despite them being more knowledgeable, they were more likely to select a credit card based on impulse. Originality/value – This paper examines how materialism may in fact encourage some consumers to make better decisions because they are more motivated to develop better knowledge. It also shows how better credit card selection may inhibit impulse purchasing.

Lending a hand: perceptions of green credit cards

2018 ◽  
Vol 36 (7) ◽  
pp. 1329-1346 ◽  
Author(s):  
Lei Huang ◽  
Julie Fitzpatrick
Keyword(s):  
Social Exchange ◽  
Undergraduate Students ◽  
Credit Card ◽  
Symbolic Interaction ◽  
Environmental Concern ◽  
Credit Cards ◽  
Medium Size ◽  
Content Type ◽  
The Usa ◽  
The Impact

Purpose The purpose of this paper is to explore the impact of donation amount and framing on financial products, this research investigates consumers’ attitudes and behaviors toward cause-related credit cards with different donation sizes and framing types. Design/methodology/approach This research investigates consumers’ perceptions of green credit cards using two experiments with a between-subject design (n =297) and a mixed design (n =238), respectively. All the participants, recruited from a major state university in the USA, are undergraduate students who use credit cards. Findings A medium-size donation optimizes the outcome of a cause-related credit card offer. Moreover, a donation framed as cash rewards has stronger effects on a consumer’s perception and consequent reactions to the “green” credit cards than an annual percentage rate framing. Finally, consumers with high levels of environmental concern and propensity to volunteer have stronger intention to adopt and are more likely to recommend the proposed credit card. Originality/value Building upon the theories of social exchange and symbolic interaction, this research is the first to provide empirical evidence regarding the application of volunteerism and perceived consumer effectiveness for financial institutions and their cause-related marketing campaign partners in selecting suitable environmental causes.

scholarly journals The COVID-19 Shock and Consumer Credit: Evidence from Credit Card Data

2021 ◽  
Vol 2021 (008) ◽  
pp. 1-55
Author(s):  
Akos Horvath ◽  
◽  
Benjamin Kay ◽  
Carlo Wix ◽  
◽  
...  
Keyword(s):  
Interest Rates ◽  
Credit Card ◽  
Negative Impact ◽  
Consumer Credit ◽  
Credit Cards ◽  
Sharp Decrease ◽  
Main Driver ◽  
Credit Card Data ◽  
Pandemic Severity ◽  
The Impact

We use credit card data from the Federal Reserve Board's FR Y-14M reports to study the impact of the COVID-19 shock on the use and availability of consumer credit across borrower types from March through August 2020. We document an initial sharp decrease in credit card transactions and outstanding balances in March and April. While spending starts to recover by May, especially for risky borrowers, balances remain depressed overall. We find a strong negative impact of local pandemic severity on credit use, which becomes smaller over time, consistent with pandemic fatigue. Restrictive public health interventions also negatively affect credit use, but the pandemic itself is the main driver. We further document a large reduction in credit card originations, especially to risky borrowers. Consistent with a tightening of credit supply and a flight-to-safety response of banks, we find an increase in interest rates of newly issued credit cards to less creditworthy borrowers.

How website quality affects online impulse buying

2018 ◽  
Vol 30 (1) ◽  
pp. 235-256 ◽  
Author(s):  
Umair Akram ◽  
Peng Hui ◽  
Muhammad Kaleem Khan ◽  
Yasir Tanveer ◽  
Khalid Mehmood ◽  
...  
Keyword(s):  
Credit Card ◽  
Sales Promotion ◽  
Equation Modeling ◽  
Impulse Buying ◽  
Website Quality ◽  
Content Type ◽  
Impulse Purchases ◽  
The Impact ◽  
The Relationship ◽  
Credit Card Use

Purpose The purpose of this paper is to investigate the impact of website quality on online impulse buying behavior (OIBB) in China, and assess the moderating roles of sales promotion and credit card use. Design/methodology/approach An online and personal survey from 1,161 online shoppers belonging to three big cities of China – Beijing, Shanghai, and Nanjing – was conducted. A random sampling technique was utilized for data collection. Data were analyzed using validity and reliability tests, confirmatory factor analysis, and structural equation modeling. Findings Three major findings discovered are: first, the website quality positively affects the OIBB; second, the sales promotion significantly influences OIBB and acts as a strong moderator on the relationship between website quality and online impulse buying; and third, the online impulse purchases are positively influenced by use of credit card, and the use of credit card enhances the relationship between website quality and online impulse buying. Research limitations/implications First, the website quality positively affects the OIBB; second, the sales promotion significantly influences OIBB and acts as a strong moderator in the relationship between website quality and online impulse buying; and third, online impulse purchases are positively influenced by credit card use. Moreover, credit card use enhances the relationship between website quality and online impulse buying. Originality/value This research is the first to investigate the relationship between website quality and OIBB in China, with sales promotion and credit card use as moderators.

The impact of corporate social responsibility on the risk of commercial banks with different levels of financial constraint

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Liem Thanh Nguyen ◽  
Khuong Vinh Nguyen
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Risk Taking ◽  
Bank Risk ◽  
Bank Performance ◽  
Content Type ◽  
Corporate Social ◽  
The Impact ◽  
The Relationship ◽  
Different Levels

PurposeThis research investigates the link between corporate social responsibility (CSR) activities and bank risk-taking in Vietnam and introduces the constraint factor to see whether this link alters with different levels of constraint.Design/methodology/approachUsing a sample of commercial banks in Vietnam from 2008 to 2017, this study employs two-step system generalized method of moments (Sys GMM) with a finite sample correction mechanism to estimate the models.FindingsThe results suggest that CSR activities reduce bank risk-taking, and this relationship is only present in the case of financially constrained banks. Unconstrained banks, on the other hand, are more likely to invest in unnecessary CSR, thus reducing bank performance and increasing bank risk-taking.Research limitations/implicationsThe first implication from this study is that CSR activities might be considered as a risk-mitigating tool and should be invested in that respect. Secondly, regulatory units and investors should be more cautious about CSR expenditures since this type of spending could increase default risk, especially for banks with easy access to external financing. One particular limitation of this study is the low number of observations available for banks in Vietnam. Future studies could use texture analysis to expand the sample or consider macro-level governance characteristics to examine which factors might modify the relationship between CSR and bank risk.Originality/valueVery limited studies discussed the link between corporate social responsibility and bank performance and bank risk. There are even fewer papers examining the relationship between CSR and risk, and most of these papers deal with advanced economies. Furthermore, no studies investigate the interaction effect of CSR and financial constraint, which should be prevalent in developing countries on bank risk. As a consequence, the current study seeks to verify the impact of financial constraints on the link between CSR and bank risk.

A European empirical study of the relationship between firms’ intellectual capital, financial performance and market value

2017 ◽  
Vol 18 (4) ◽  
pp. 771-788 ◽  
Author(s):  
Filipe Sardo ◽  
Zélia Serrasqueiro
Keyword(s):  
Financial Performance ◽  
Intellectual Capital ◽  
Western Europe ◽  
Market Value ◽  
Content Type ◽  
Large Sample ◽  
Explanatory Variables ◽  
Long Run ◽  
The Impact ◽  
The Relationship

Purpose The purpose of this paper is to analyze the relationship between firms’ intellectual capital (IC), financial performance (FP) and market value (MV) as well as the relationship between ownership concentrations on IC performance. Design/methodology/approach A large sample of non-financial listed firms belonging to 14 countries in Western Europe, for the period between 2004 and 2015, was investigated using the GMM system (1998) dynamic estimator and the effect of lagged explanatory variables on firm’s FP and MV. Findings The results reveal that IC is an important resource for firms’ value creation. Human capital is found to be a key factor of firms’ wealth. Results show that capital employed efficiency positively impacts on firms’ FP in the short run. The impact of IC components on firms’ MV may not be immediate. The structural capital positively affects firms’ FP in the long run. Also, the results reveal that ownership concentration and owners’ management involvement constrain firms’ IC performance. Originality/value The current study contributes to IC research by exploring a large sample of firms across countries in Western Europe using econometric modeling. Considering that the effect of IC on firms’ FP needs time to be realized, thus to be measured, the effect of lagged explanatory variables on performance was tested, using dynamic panel estimators, specifically the GMM system (1998) dynamic estimator.

Credit card literacy and financial well-being of college students

2019 ◽  
Vol 37 (4) ◽  
pp. 991-1003 ◽  
Author(s):  
Yam B. Limbu ◽  
Shintaro Sato
Keyword(s):  
College Students ◽  
Self Efficacy ◽  
Credit Card ◽  
Credit Cards ◽  
Well Being ◽  
Content Type ◽  
Mediating Role ◽  
Moderated Mediation Model ◽  
The Relationship

Purpose By testing a moderated mediation model, the purpose of this paper is to examine the mediating role of credit card self-efficacy in the relationship between credit card literacy and financial well-being. The authors further examine if credit card number moderates this effect. Design/methodology/approach Data for the study were collected from 427 college students. The PROCESS macros in IBM SPSS Statistics 23 was used to assess the hypothesized relationships. Findings Credit card literacy positively influences financial well-being through self-efficacy. However, this effect is stronger when college students own fewer credit cards. Practical implications Banks and credit card issuers, policymakers and colleges and universities should place a greater emphasis on credit card literacy programs that enhance students’ general understanding of credit card terms and conditions and confidence in their ability to effectively use and manage their credit cards. Originality/value To our knowledge, this is the first study to examine the relationship between credit card literacy, self-efficacy and financial well-being.

The mediating role of cost of capital in the relationship between capital structure and loan portfolio quality

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ester Agasha ◽  
Nixon Kamukama ◽  
Arthur Sserwanga
Keyword(s):  
Capital Structure ◽  
Interest Rates ◽  
Cost Of Capital ◽  
Credit Rationing ◽  
Loan Portfolio ◽  
Content Type ◽  
Mediating Role ◽  
The Impact ◽  
The Relationship

PurposeThe purpose of this paper is to establish the mediating role of cost of capital in the relationship between capital structure and loan portfolio quality in Uganda's microfinance institutions (MFIs).Design/methodology/approachA cross-sectional research design was adopted to collect data and partial least squares structural equation modelling was used to test the study hypotheses.FindingsCost of capital partially mediates the relationship between capital structure and loan portfolio quality. Hence, cost of capital acts as a conduit through which capital structure affects loan portfolio quality.Research limitations/implicationsCost of capital was generalized as financial and administrative costs. The impact of costs like dividend pay-outs, interest rates and/or loan covenants on loan portfolio quality could be investigated individually.Practical implicationsMFIs should be vigilant about loan recovery by using strategies like credit rationing to ensure timely repayments.Originality/valueThe study contributes to the ongoing academic debate by identifying the significant indirect role of cost of capital in explaining loan portfolio quality.

How friendship networks work in online P2P lending markets

2015 ◽  
Vol 6 (1) ◽  
pp. 42-67 ◽  
Author(s):  
Siming Li ◽  
Zhangxi Lin ◽  
Jiaxian Qiu ◽  
Roozmehr Safi ◽  
Zhongyi Xiao
Keyword(s):  
Interest Rates ◽  
Ordinary Least Squares ◽  
Friendship Networks ◽  
Least Squares Regression ◽  
Friendship Network ◽  
Data Set ◽  
Content Type ◽  
P2p Lending ◽  
The Impact ◽  
The Relationship

Purpose – The purpose of this paper is to study the effects of multidimensional friendship networks on economic outcomes in the domain of online people-to-people (P2P) lending markets. Design/methodology/approach – The empirical analysis is based on the data set of transactions and friendship networks from PPDai.com market, the most prominent P2P lending market in China. A friendship hierarchy is proposed in this paper to conceptualize friendship network types. Furthermore, methodologies of t-test, logistic regression and ordinary least squares regression are implemented to measure the impact of multidimensional friendship network variables on the probability of successful funding, as well as the interest rates on funded loans. Findings – The study demonstrates significant effects of structural, relational and cognitive friendship networks using PPDai.com data. The results indicate that structural friendship network measured in terms of the number of friendship ties is a significant factor of funding performance. Additionally, borrowers, who are involved in higher-quality friendship networks, are more likely to be funded and pay lower interest rates on funded loans. Also, the deeper the level of the relationship is in the friendship hierarchy, the more significant will be the effect of friendship on the final economic results. Furthermore, quality is more important than quantity in determining funding performance. Originality/value – This paper is the first to study the effects of multidimensional friendship networks on economic outcome variables in the domain of online P2P lending, thus broadening the theory of multidimensional social capital, which can deepen our understanding about how social networks work and have significant implications practically and theoretically.

Linking satisfaction to credit card decisions: an application of the Wallet Allocation Rule

2017 ◽  
Vol 35 (2) ◽  
pp. 205-219 ◽  
Author(s):  
Lerzan Aksoy ◽  
Timothy L. Keiningham ◽  
Alexander Buoye ◽  
Joan Ball
Keyword(s):  
Interest Rates ◽  
Credit Card ◽  
Scientific Literature ◽  
Credit Cards ◽  
Credit Union ◽  
Retail Banking ◽  
Allocation Rule ◽  
Content Type ◽  
Key Driver ◽  
Key Drivers

Purpose The purpose of this paper is to identify the key drivers of share of wallet for credit cards issued by either a credit union (CU) or bank using a Wallet Allocation Rule (WAR) framework. Design/methodology/approach A survey approach engaging 1,649 current CU members at nine CUs regarding their use of 3,487 different credit cards is employed. Binary logistic regression is used to discriminate when CU issued vs bank issued credit cards are perceived to be “best” by their owners. Findings This research indicates the key drivers differ significantly when CU members prefer a CU-issued credit card vs a bank-issued credit card. For example, CU-issued credit cards are attractive to some CU members because of prior relationships with the CU and offering lower interest rates on revolving balances. By contrast, customers who choose a bank-issued credit card are much more likely to be driven by the rewards offered on the card. Practical implications Using the WAR key driver approach, managers can identify differentiating attributes that influence customers’ perceptions of their rank vis-à-vis competition and thereby grow share. Originality/value This research provides a significant contribution to both the banking literature and the scientific literature by examining the robustness of a relative metrics approach within the retail banking and CU market. It represents the first empirical analysis of a WAR key driver approach in the scientific literature.

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