The adoption and usage of credit cards by urban‐affluent consumers in China

Abstract

Purpose -The purpose of this paper is to present exploratory research into the holding and usage of credit cards by a distinct segment of the Chinese population, who are "early adopters" of this product. Design/methodology/approach -Primary data collection using survey methodology. A sample of the urban-affluent population in China was utilized to gauge preferences and attitudes towards the use of credit cards. Findings -The respondents were comfortable with the holding and use of credit cards and particularly recognised their value for spending on travel and entertainment. The research also identified purchase trigger points, which indicated that the use of credit cards for purchases above certain value was already prevalent with this sample of urban-affluent Chinese consumers.Research limitations/implications -The sample was drawn from a narrower base than the actual target population of urban-affluent market, but an available and valid respondent set, which offers insights into the "early-adopters" of the credit card product in China. Practical implications -Hitherto there has been a very limited amount of research into payment cards in China and yet with the market for financial services opening up in China from 2007, this research is timely both for domestic Chinese banks wishing to issue credit cards and for foreign entrants, seeking to enter the Chinese market via their expertise in credit cards. Originality/value -The paper presents focused research on the attitudes towards credit cards, with the urban-affluent consumers, who are the most likely early-adopters of this product.

Correlates of Credit Card Adoption in Urban China

“…But neither Citibank nor other foreign banks could offer services in domestic currency (Worthington 2003). Although this restriction was lifted in December 2006 (Worthington et al 2007), limits on such things as bank location and services that could be offered by foreign banks remained.…”

“…Initially, credit cards were marketed to high income, high wealth urban Chinese (Worthington et al 2007). Subsequently, credit card offers were made to young adults, college students, and those with relatively lower income.…”

Money attitudes, credit card and compulsive buying behaviour: a study on Indian consumers

“…Credit card use relates to dimensions like convenience, payment and flexibility. People use credit cards for both functional and symbolic reasons (Meidan and Davos, 1994;Worthington et al, 2007;Gan et al, 2008;Wickramasinghe and Gurugamage, 2009;Ahmed et al, 2010). The current research examines the influence of money attitudes on…”

“…It is important to realise that given the nature of service, consumers are likely to switch to another firm even if their problems get resolved. Worthington et al (2007) posits that credit cards were used by Chinese for primarily travel and entertainment. Urban Chinese used credit cards while travelling abroad.…”

Consumers’ Perceptual Biasness in Debit Cards of Indian Banks

“…These cards have changed the horizon with various features like identity proof, storage for bank data, e-purse, finger print, health record, blood group and license details of each individual [36]. Worthington et al Customers feel comfortable to hold and use of the credit cards for spending on travel and entertainment purpose [37]. The multiple cardholders are always feeling comfortable to spend more through a specific credit card called main card which indirectly gives benefit to the card issuer [38].…”