Cash or Card: Consumer Perceptions of Payment Modes - Scholarly ...

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For more than a decade, there have been several attempts to integrate ‘smart card technology’ into ‘mobile devices’ to enable mobile payments for business to consumer (B2C) payment transaction processing. In the era of third generation (3G) mobile network, mobile payment is imminent. Many European and Asian countries, including Korea, Singapore, and Japan have adopted this technology (Pousttchi, Sciessler, and Wiedemann, 2009). It is emerging in North America. In Japan, it is possible to pay for a vending machine snack by simply dialing a number on one’s mobile phone and having the amount charged to one’s phone bill. In recent times, the mobile phone is increasingly used to purchase digital content (e.g. ringtones, music, apps, or games), tickets, parking fees and transport fares in many economically developed nations just by flashing the mobile phone in front of the scanner at ‘manned’ or ‘unmanned payment centres. Although a ‘cashless’ society has a number of advantages, social commentators and environmental activists have expressed concerns that it would increase overall consumption, increase personal debt levels, reduce savings and that the resultant ‘over-consumption’ will have an adverse impact on the society and environment (Nocera, 1994; Libow, 1955; Tilford, 2000; Zavestoski, 2002; and MacDonald Oates,Young and Hwang, 2006). Whether over- consumption can be entirely attributable to a cashless society is uncertain. A common lay explanation for over-consumption is that people get into financial difficulties through treating as necessities, goods whose only function is social display. Walker, Lea and Webley (1992) found that people with serious debt problems regarded certain kinds of expenditures on children (for example fashion goods and substantial Christmas gifts) as necessities, and would run into debt in order to maintain them, even though gifts are inherently luxurious (Gilliz and Belk, 1996) , “One specific claim is that some consumers have self-control problems; therefore they spend more regardless of mode of payment, save less and embark on a consumption path that is unsustainable to self and as a whole to society (Garcia-Swartz, Daniel, Hahn and Layne-Farrar, 2007; O’Guinn and Faber, 1989). Though this may be the case, the positive relationship between access to credit and consumption levels is well documented (Durkin and Staten, 2002; Manning, 2000) Therefore it may be that the increased spend per transaction, observed in the credit card based studies, may be due to the availability of credit and not just to the ‘cashless’ factor. This does not negate a possible decoupling effect, but the credit factor in the transaction payment should be isolated for this to ascertain. 5
1.5: Study Locus and Context The availability of Eftpos (Electronic Funds Transfer at Point of Sale) is mainly concentrated in Europe, and the OECD countries. A recent report by Global Industry Analysts (2007) predicts increased growth in India and Asia, specifically China. Though such payment options are available, their actual usage across countries varies. Western European countries use debit cards more than Americans however Borzekowski, Kiser and Ahmed, (2006) report an increased use of debit cards in lieu of credit cards. Variation in use can be attributed to structural and cultural factors. For example, in India because merchants are charged for each transaction Eftpos transaction are low and Indians prefer to withdraw from an ATM and then pay cash for purchases (Sumanjeet, 2009). Cultural factors such as a preference for cash in China and Japan also influences Eftpos acceptance (Singh, 2004). This study is located in New Zealand. New Zealand, along with the Netherlands, leads the world in the use of Eftpos. A report by the Westpac bank (2007) estimated that there is more than one Eftpos terminal for every 50 people in New Zealand and points out that this per capita usage is the highest globally. Since this indicates familiarity with cash and card (debit and credit) use, this makes New Zealand an ideal research context. Given that the European Union and government of numerous nation states are pushing for increased use of EMTS and the Global Industry Analysts report predicts a 15% growth in Asia and 12% in Europe the findings of this study may have global relevance. How New Zealanders use their credit card also needs to be considered. Some use their credit cards as sophisticated money management tools. In New Zealand most credit cards offer a fifty-five day free interest period and so use of the card allows a savings account to accrue interest; this use is only beneficial if the debt is paid within the set period. This interest free period only applies to purchase transactions; withdrawals of cash incur immediate interest charges. However used this way, the credit card can function as a quasi debit card. As the intent is to try and isolate the credit factor, even though credit cards can operate as a quasi 6
Page 1 and 2: Cash or Card: Consumer Perceptions
Page 3 and 4: Chapter Four: Research Design and M
Page 5 and 6: List of Figures Figure 6.1 Sree Plo
Page 7 and 8: List of Tables Table 6.1. Explorato
Page 9 and 10: Acknowledgement The research idea i
Page 11 and 12: Abstract This study examines the co
Page 13 and 14: the payment mode selected impacts o
Page 15: Identifying the exact origin of anc
Page 19 and 20: compare participants normal or pref
Page 21 and 22: Chapter 2 provides a critical revie
Page 23 and 24: 2.2: The Emergence of the Money Con
Page 25 and 26: commodity (bullion) and issued the
Page 27 and 28: 2.5: Payment Mode and Purchase Beha
Page 29 and 30: and Belmont (1996) found that resta
Page 31 and 32: Households’ Spending’ run by th
Page 33 and 34: students (n=37) were also asked to
Page 35 and 36: enefit of consumption and the assoc
Page 37 and 38: associated with the purchase of ple
Page 39 and 40: A number of explanations for how pa
Page 41 and 42: 2.6.5: Summary As this review of th
Page 43 and 44: Questions one and two are based on
Page 45 and 46: and label" events and occurrences,
Page 47 and 48: Thaler (1998) asserts that mental a
Page 49 and 50: If this is so then it is the transp
Page 51 and 52: The Chapter contends that the payme
Page 53 and 54: In this chapter, the methodology fo
Page 55 and 56: solid data, the issue of generalisa
Page 57 and 58: the experience. To do this requires
Page 59 and 60: as participants managed to link the
Page 61 and 62: 4.4.2: Participant Selection There
Page 63 and 64: were initially examined via a test-
Page 65 and 66: set, in addition to the payment mod
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There are two major validity threat
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The Chapter commences by describing
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of all three projective tests. A fu
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However the negative thoughts diffe
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cold. It seems that money in the de
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thought the shoe (that was linked t
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Exhibit 5.6: Summary of findings $2
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denominations ($5, $10). On the oth
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Emotions (see Exhibit 5.7g) The mos
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� It is just when I can hear coin
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� I don’t feel that when I see
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Exhibit 5.7 (c) LIQUIDITY � if I
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Exhibit 5.8. Quotes for PMP Scale.
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82 Using cash to pay for purchases
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84 Using a debit card to pay for tr
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` 86 If I had a $20 note in my wall
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88 Chapter Six Development and Vali
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latent variable determines the obse
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oot (sqrt) was applied to normalize
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Exploratory Factor Analysis reveale
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96 Table 6.2: Inter-Item and Item-t
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98 Exhibit 6.5: 49 Item Scale in Pr
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6.4.2: Pre-Test Two - Internal Cons
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The 45 items were examined to facto
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6.4.4: Pre Test Two - Final Factor
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6.4.6: Assessing Construct Validity
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used to measure individual construc
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110 Exhibit 6.9: Pre-Test Items Rem
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Table 6.14: Summary of Final Result
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All dimensions (Table 6.16) show AV
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7.1: Chapter Overview 116 Chapter S
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Four product categories of househol
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Since the use of cash and debit car
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7.4.1.2: Control Group-Test Groups
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7.4.2: Proposition Two Evaluation T
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126 Table 7.8: Indulgence Food Prod
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128 Exhibit 7.2: Proposition Two: E
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130 Table 7.12: Comparisons of Fact
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Proposition Two that- where consume
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Table 7.13: Mean Item Score: Field
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Research Question One: Do the cogni
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token is used, perceptions and beha
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would spend it on something special
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8.4: Methodological Contribution Th
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144 � The priming regarding the s
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it may be prudent for governments,
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Bechara, A., & Damasio, A. (2005).
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Carruthers, B., & Babb, S. (1996).
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Dohrenwend, B. P., Itzhak Levav, P.
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Garcia-Swartz, D., Hahn, W. R., & L
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Hair, J. F., Black, W. C., Babin, B
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Kassarjian, H. H. (1977). Content a
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Loix, E. Pepermans, R. Van Hove, L.
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Nielsen Research (2011, August) Nie
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Reimann & Bechara (2009) The somati
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Singh (2004) Impersonalisation of e
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Trent, J. & Smalley, G. (1992) The
Page 181 and 182:
Zelizer, V. (1994). The social mean
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its usage. This in turn points out
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Adam Smith proposed that money is s
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During the 1950s, researchers began
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use of borrowed money. The introduc
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Appendix 2: Projective Tasks- Workb
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TASK THREE For this activity you wi
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TASK SIX Shopping experience using
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Activity Two Tick five traits/chara
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Appendix 3: Moderator Guide When pa
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important. Individual opinions and
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192 Write few sentences describing
Page 205 and 206:
Appendix 5: Projective Tests- Theme
Page 207:
Appendix 7: Projective Tool (Debit
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