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

averse (see Fusaro, 2006; Zinman, 2004; Lee, Abdul-Rahman, & Kim, 2007).
2.5.2.1: Debit Cards and Purchase Behaviour
Only a handful of studies examine the relationship between debit card use at the point of sale
and purchase behaviour. The survey by Jonker (2005) reports that debit cards are more
frequently used (compared to other modes) in non-food retail, petrol, supermarket purchases
and public transport use; and that fast-food purchases are mostly paid for by cash. Klee
(2004) links card use to total spent in a single grocery purchase situation. She notes that
purchases of $150 and above were paid by cheque (39%) credit card (25%), debit card (21%)
and 15% by cash. This reflects the US preference for cheque and credit card modes - but
debit card use is close to the credit card use. Bounie and Francois (2009) asked participants to
diarise their shopping behaviour across six shopping occurrences. The final sample size was
substantial - 1447 participants across France submitted their diary records. They report that
demographic characteristics had no significant relationship with ownership and use but the
type and size of transaction did - with cash preferred for low cost payments and cards (both
debit and credit) preferred for high cost payments.
Soman (2003) found that the use of pre-paid cards and cash in the context of dry-cleaning and
photocopying services increased the use of both services. However it should be noted that pre-
paid cards require the user to load money in the card before they could make any purchase.
Loading a card for specific purchases (e.g., laundry, fuel, transportation, or photocopying)
rather than general use could produce different associations to that of a debit card. Thaler,
(1985; 1999) and Gourville and Soman (1998) suggest that the pseudo-sunk cost effect may
come into play. For example if a customer deposited money into an account (such as prepaid
cards) that is earmarked for a specific purpose the customer may consider it not fungible and
consider it ‘spent’.
Thomas, et al. (2011) in a collage of studies examined payment use across a number of
conditions. Their research comprises four separate studies:
Study One: One thousand purchase receipts from a scanner panel were grouped
based on payment mode (cash, credit and debit card) where cash registered 500 receipts; the
credit card was 410 receipts and the debit card only 90. To determine the impulsive factor,
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