Bank and Nonbank Credit Card Possession and Use: Changes Over Time

Abstract

University of Alabama P a t r i c i a M. Rudolph, University of Alabama Edward B. Selby, J r . , University of Georgia The possession and use of c r e d i t cards has been o f i n t e r e s t t o c r e d i t card i s s u e r s , monetary policy makers, and researchers f o r many years. Who possesses c r e d i t cards and how they are used has an impact on c r e d i t extension and the paymerit mechanism. Moreover, many of the sophisticated e l e c t r o n i c funds t r a n s f e r systems, such as point of s a l e terminals a r e card based. In t h i s paper, survey data a r e analyzed using probit analysis t o determine what c h a r a c t e r i s t i c s a r e related t o possession and use of c r e d i t cards and i f t h e r e has been s i g n i f i c a n t change over time. The data provide information on both possession and use of c r e d i t cards f o r two d i s t i n c t time periods. First, the factors which have an impact on an individual having a c r e d i t card a r e discussed. Economic and demographic f a c t o r s such as race, education, occupation, home ownership, car ownership and income a r e used t o explain the decision t o have c r e d i t cards. By looking a t these f a c t o r s in 1971 and again i n 1983, any changes which have occurred over time can be i d e n t i f i e d . Once an individual has a c r e d i t card, he/she must decide when and i f t o use i t . Not only the economic and social characterist i c s associated with the individual but the type of transaction should have an e f f e c t on t h e choice of payment means. In the survey, respondents were asked how they most frequently paid f o r a v a r i e t y of purchases and b i l l s . In this paper, those types of transactions which can be paid with c r e d i t cards such a s gasoline, clothing, small household goods and furnishings a r e discussed. Again, the analysis i s run f o r both 1971 and 1983 i n order t o identify possib l e changes. Age, race, occupation, income, c a r ownership and home ownership have a s i g n i fi c a n t impact on the decision t o have c r e d i t cards. These same variables a r e a l s o s i g n i f i c a n t i n deciding whether t o use c r e d i t cards. Results indicate t h a t there have been decreases over time i n the possession o f gas cards and s t o r e cards but with increasing c r e d i t card use f o r clothing, f u r n i t u r e and household goods. Few other changes have occurred i n the f a c t o r s which a f f e c t e i t h e r decision over time.

Consumer credit card ownership and usage practices: empirical evidence from Sri Lanka

“…Respondents' use of credit cards for day‐to‐day expenses and credit card spending on durables is low. Although previous studies found significant differences in making payments for household goods, clothing, entertainment, travel and food away from home by sex (see Lindley et al. , 1989; Hayhoe et al.…”

“…, 1977); single males were more likely to use credit cards than females (White, 1975). Evidence also reveals that the impact of sex on types of credit card purchase is significant, where females use credit cards more for household goods, clothing and personal belongings (Lindley et al. , 1989; Hayhoe et al.…”

Effects of social demographic attributes, knowledge about credit cards and perceived lifestyle outcomes on credit card usage

“…Much of the literature on credit card usage practices examined the type of credit card purchases (e.g. Lindley et al ., 1989; Hayhoe et al ., 2000; Kaynak and Harcar, 2001), the place of purchase (e.g. Hayhoe et al ., 2000; Kaynak and Harcar, 2001), credit history (Kim et al ., 2005) and the amount of monthly expenses through credit cards (Kaynak and Harcar, 2001).…”

“…Hayhoe et al ., 2000; Kaynak and Harcar, 2001), credit history (Kim et al ., 2005) and the amount of monthly expenses through credit cards (Kaynak and Harcar, 2001). For instance, past studies provide evidence that females use credit cards more for household goods, clothing and personal belongings (Lindley et al ., 1989; Hayhoe et al ., 2000; Kaynak and Harcar, 2001), while males use cards more for electronics, entertainment, travel and food away from home (Kaynak et al ., 1995; Hayhoe et al ., 2000; Kaynak and Harcar, 2001).…”

Penggunaan Kartu Kredit Dan Perilaku Belanja Kompulsif: Dampaknya Pada Risiko Gagal Bayar

“…Ada juga yang menggunakan untuk membiayai konsumsi mereka (Lee & Kwon, 2002). Berbagai macam motif ini mendorong setiap pemegang KK memiliki perilaku yang berbeda seperti intensitas penggunaan (Chan, 1997), di mana KK sering digunakan, produk-produk tertentu yang dibeli (Lindley et al 1989). Kaynak & Harcar (2001) menemukan bahwa penggunaan KK berhubungan positif dengan pendidikan dan pendapatan.…”