Acquisition mode and credit card overspending behavior: An empirical analysis of the credit card industry

Abstract

Although credit card overspending behavior has become a critical societal concern with severe negative impacts on consumer welfare and economic stability, research on credit card overspending behavior remains fragmented and understudied. This study investigates new types of antecedents of credit card overspending behavior that are overlooked in the prior literature—the acquisition mode of credit card companies. Based on data set from a large commercial bank in China, this study measures credit card overspending behavior using consumption amount, cash withdrawal amount and overdueness, and suggests that gift acquisition has a positive effect on cash withdrawal amount and overdue probability as well as a negative effect on consumption amount. Furthermore, we find that this relationship could be weakened for female customers and for customers with higher education levels. This study provides theoretical implications for both the credit card overspending literature and customer acquisition literature. It also has important implications for consumer welfare and public policymaking.

Precedents of the compulsive use of a credit card: an analysis of university students' buying behavior

“…Furthermore, when we consider that compulsion can be seen as a disorder, treatment by health professionals and psychology should be recommended. In extreme cases, for instance, the disorganization of individuals in personal financial crises can be a reason for suicide (Ming and Chen, 2021; Santos et al. , 2021).…”

Pengurusan Hutang Kad Kredit – Sorotan Literatur Bersistematik daripada 2010-2020 (Credit Card Debt Management – Systematic Literature Review from 2010-2020)

“…Kajian ini penting kerana kesan daripada masalah keterhutangan tanpa pengurusan hutang yang baik menyebabkan individu yang berhutang akan menghadapi pelbagai jenis masalah seperti tekanan kewangan, tekanan perasaan, malahan sehingga kes jenayah bunuh diri serta memberi kesan negatif pada peringkat mikro dan makro ekonomi negara (Abd. Rahman, 2017;Amit et al, 2020;Arshat, Pai, & Ismail, 2018;Dunn & Mirzaie, 2016;Frigerio, Ottaviani, & Vandone, 2020;Ming, Li, & Chen, 2021;Othman, S., Zulkiple, & Jusoff, 2013;Theong, Osman, & Yap, 2018).…”

Muslim Consumers’ Credit Card Debt Management

“…Therefore, the demand for credit cards is still high, intended to facilitate them during the adventure period (Mason & Madden, 2017;Arsyianti & Adelia, 2019). As "travel" and "work-related activities" have grown in popularity, credit card users have found it to be convenient because it gives them a great deal of security and flexibility while also luring them into other negative outcomes like overspending and debt (Lin, Revindo, Gan, & Cohen, 2019;Soh, 2019Ming, Li, & Chen, 2021.…”