Assessing the Gains from E-Commerce

PurposeThis exploratory study seeks to explore the link between the choices of payment mode to customer satisfaction. It examines the Austrian market in relation to its choice and usage of debit cards versus credit cards and its impact on customer satisfaction and loyalty. Furthermore, the study aims to identify the key drivers of customer satisfaction for these two modes of electronic payment.Design/methodology/approachA structured questionnaire was administered in person to 360 Austrian bank customers. These customers were selected using quota sampling based on Austrian census data for a particular Austrian province. However, while the quota sampling was used to determine the categories, selection of the actual respondents was done through systematic sampling. This ensured that the sample was representative of the population of that Austrian province who had credit and debit cards. One group, women who were 65 and older, were not considered as there were relatively few women in this age range who had debit and credit cards.FindingsFive hypotheses were proposed. Four of the five hypotheses were supported while one, H4, had partial support. Essentially, the results indicate that a person's preference for a particular payment method is dependent on his/her personal characteristics. Additionally, the payment method's features and characteristics influenced its desirability and acceptance. Furthermore, a person's expectations had an impact on his/her attitude toward the payment method. The study also found that positive expectations, performance, and desires led to customer satisfaction. Customer satisfaction, in turn, leads to a higher degree of intent to use the payment method and higher degree of intent to recommend the payment method. These results are consistent with the literature on customer satisfaction that identifies expectations, performance and desires as the drivers of customer satisfaction.Originality/valueMultiple payment modes have emerged but there has been scant attention paid to the effects of payment modes on customer behavior and by extension, customer satisfaction and loyalty. This paper addresses these issues.

Using data from the United States and Canada, we quantify consumers’ net pecuniary cost of using cash, credit cards, and debit cards for purchases across income cohorts. The net cost includes fees paid to financial institutions, rewards received from credit or debit card issuers, and the merchant cost of accepting payments that is passed on to consumers as higher retail prices. Even though credit cards are more expensive for merchants to accept compared with other payment methods, merchants typically do not differentiate prices at checkout, but instead pass through their costs to all consumers. As a result, credit card transactions are cross-subsidized by cheaper debit and cash payments. Card rewards and consumer fees paid to financial institutions are additional sources of cross-subsidies. We find that consumers in the lowest-income cohort pay the highest net pecuniary cost as a percentage of transaction value, while consumers in the highest-income cohort pay the lowest. This result is robust under various scenarios and assumptions, suggesting payment card pricing and merchant cost pass-through have regressive distributional effects in the United States and Canada.

In the current market, usage of e-payment has been dominant instead of the physical cash payment method. Money is transferred out from a bank account using a debit card, credit card, or online banking to pay people using the e-wallet, offering the effortlessness of a cashless payment method. The Internet turned out to be the pillar technology, particularly for the retail industry, electronic payments, mobile payments, and banking systems initiated to develop. Beforehand, cashless transactions are just individuals making payments by using debit or credit cards, which are the main initiative of the development of banking system technology. Due to the era of globalization, the utilization of banking system technology between banks and third parties, debit, and credit debit cards can also be considered e-payments. The study's objectives are to identify the effect of perceived compatibility, social influences, personal innovativeness, and facilitating conditions on customer intentions among working adults who use mobile phones for e-payment in Klang Valley. This research shows that the use of the UTAUT model is helpful to assist academicians and marketers as a further research purpose to understand the consumer’s intention towards the acceptance of new technology which is e-payments. From this study, the finding shows that positive sign which is seen across the independent variables of social influence perceived compatibility, and facilitating condition. There is no relationship between personal innovativeness and customers’ intention to use mobile phones for e-payment in Klang Valley. Quantitative data had been obtained through the distribution of online questionnaires to 384 targeted respondents as part of the methodology of this research. In this study, three data analysis models have been applied in data analysis descriptive analysis, multiple linear regression, and Pearson correlation coefficient analysis. The survey was analysed through SPSS version 27.

Financial industry data indicate that consumers increasingly prefer debit cards over credit cards, especially as a means of enforcing financial self-discipline. Given prior research suggesting that credit cards act as spending facilitating stimuli, this move toward reduced credit card use would appear to be in the right direction. Ironically, however, the same logos that were implicated in facilitating spending with credit cards are the logos that appear on debit cards. In what should serve as an eye-opener to consumers, it is found that exposure to debit card logos does result in an increased willingness to spend, similar to credit cards.

The objective of this study is to analyze the effect of transaction values using cards (Card Payment Instruments/APMK), namely credit cards and debit cards, as well as float funds on the Velocity of Money (VOM) in Indonesia. This study employs a quantitative approach using descriptive methods, utilizing secondary data on credit card transaction values, debit card transaction values, float funds, and VOM over the period 2015–2024. The data sources were obtained from the official websites of the Bank of Indonesia (BI) and the Central Statistics Agency (BPS). The analysis method employed is the Error Correction Model (ECM) to observe short-term and long-term dynamics. The findings of the study suggest that, over an extended period, credit card transaction values (KK) and float funds (DF) exert a positive and significant influence on VOM, while debit card transaction values (KD) prove to be statistically insignificant. In contrast, in the short term, float funds (D(DF)) exert a negative and significant influence on changes in VOM, while changes in credit cards (D(KK)) and debit cards (D(KD)) do not demonstrate a statistically significant effect. Furthermore, the lagged value of credit cards exhibits close to significant at the 10% level, suggesting a gradual adjustment effect on VOM. These findings suggest that policies promoting the optimization of credit cards and the management of float liquidity can encourage money circulation in the long term. However, the impact of debit cards must be carefully considered to avoid directly suppressing the speed of money circulation in the short term. Thus, the evolution of non-cash payment systems must strike a balance between transaction efficiency and its implications for national monetary dynamics.

Indoor tanning by adults under 35 years of age increases the risk of developing melanoma 59% to 75%. Cost is a major barrier limiting young adults from purchasing indoor tanning services. Our recent study by Boyers et al determined that 18 of 96 major universities, all in the eastern and southern United States, had university-sponsored debit cards with indoor tanning affiliations. These debit cards, which conveniently link with student identification (ID) cards, help with student living expenses and are often loaded with money by parents. By creating agreements with indoor tanning salon vendors, universities are endorsing a World Health Organization class I carcinogen. To expand the results of our previous study, we broadened our search to further assess universities in the western United States as well as Australia, New Zealand, Ireland, Canada, and the United Kingdom. Using www.collegeboard.edu, we identified the 4 largest residential colleges in Arizona, California, Colorado, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming. Additionally, we investigated the top international universities, utilizing www.topuniversities.com. Internet searches, phone calls, and email correspondence were used to determine if an institution had a student ID-linked debit card. Universities with affiliations to bank debit cards and cards that could only be used on campus were excluded. In the western United States, indoor tanning merchants were affiliated with University of Arizona, Embry-Riddle Aeronautical University: Prescott Campus, and the University of Denver student debit cards. Of the original 18 schools with affiliations according to the Boyers et al study, 2 universities no longer have agreements and 5 created agreements with additional tanning salons. Of 45 universities examined in our international search, no debit cards were discovered for off-campus purchases. Therefore, the concerning issue of university associations with tanning salons appears to be solely a domestic problem. Our findings indicate that the formation of financial agreements between universities and tanning salons is an ever-present and growing problem in the United States. Since Boyers et al, we have engaged in outreach efforts with alumni, faculty, administration, and local university cancer centers to terminate university ties with tanning salon vendors. Further advocacy efforts are critical to combat this dangerous association, reduce the frequency of skin cancer, and protect the health of young adults.

A description is given and applications are discussed of the microprocessor-based credit cards and debit cards which are currently being tested in three cities. The security aspect of the card is discussed, as are the manufacture and assembly technologies.

This Essay explains why the Supreme Court’s economic reasoning in its recent Ohio v. American Express Co. (“Amex”) decision is wrong. The Amex case involved the use of what are called “antisteering” restraints in which a retailer is not allowed to use a variety of tactics to steer a consumer away from using an American Express (“Amex”) card and toward using another payment mechanism. The reason why a merchant might want to do this is because the cost that the merchant incurs when a customer uses an Amex card can be higher than the cost that the merchant incurs when the customer uses either another credit card, debit card, or cash. Although not challenged in the Amex case, the Amex contractual rules also prevent a retailer from imposing a surcharge on customers who use an Amex card to reflect the higher merchant cost. It is interesting to note that some countries—such as Australia—have regulated certain credit card fees, others have forbidden credit card companies from telling merchants that they cannot surcharge, and some states in the United States—such as New York—have forbidden merchants from surcharging. Restraints on surcharging or steering are examples of restraints that Ralph Winter and I call “vertical most-favored-nation restraints,” (“vMFN”) in which one supplier tells a retailer that the retailer cannot set the retail price of its product higher than that of a rival, even if its wholesale price is higher than that of its rival. Such restraints have been the subject of some litigation already, but I expect that with the increasing use of web based platforms where such restraints are often used, litigation regarding such restraints will increase. This Article illustrates the underlying economic logic behind the anticompetitive effect of vMFNs. I then apply the reasoning to credit cards and finally, using the economic framework developed, explain the economic errors in the Court’s Amex decision. For a more detailed discussion, please see the Carlton and Winter paper referenced herein.

ASEAN countries are heading toward a cashless economy. Credit cards and debit cards are the major platforms of cashless payment. These platforms diffuse at a faster rate. Bass Diffusion Model was utilized to analyze and estimate the rate of the diffusion of credit cards and debit cards. The data was derived from the percentage of individuals aged 15+ who have a credit card and/or debit card in the years 2011, 2014 and 2017. Data was derived from seven ASEAN member countries: Singapore, Malaysia, Thailand, Philippines, Indonesia, Vietnam and Cambodia. Results showed that countries like Singapore, Malaysia, and Thailand served as the innovators while countries like the Philippines, Indonesia, Vietnam and Cambodia acted as the imitators.

The Costs and Benefits of Half a Loaf: The Economic Effects of Recent Regulation of Debit Card Interchange Fees

Debit cards are the fastest growing consumer payment method despite being more expensive and less versatile than credit cards. In this paper, we investigate some of the oft cited explanations for debit card use. Checking account data shows that debit card use is correlated with age, pay frequency, overdrafting, and ATM use, but not income, gender, crime, or expenditure. The data contain some signs that debit cards might be used as a method of spending restraint. (JEL D14, G21, L14)

In the latter, each receiver owns a secret private key and a publishable public key. In public-key cryptography, the sender finds the receiver's public key and uses it to encrypt the message, where as the receiver uses the private key to decrypt the message. Non-electronic payment methods (such as, using cash, writing a cheques, sending a money order, or giving your credit card number over the telephone) have several limitations in e-commerce environment. First, cash cannot be used for transactions because there is no face-to-face contact. They may be physically stolen or someone may steal our credit card number (from a receipt, over the phone, or from a Web site) and use our card to rack up debts. Credit cards can make life easier and be a great tool, but if they aren't used wisely they can become a huge financial burden. In this case, customer uses website provided by the bank. Customer logins to the bank's website and registers another bank account. He/she then places a request to transfer certain amount to that account. Online debit cards are considered superior because the PIN system has more security than signature system, which is used in offline debit cards. Smart cards are similar to credit cards and debit cards, except they store information on an embedded chip instead of on a magnetic strip on the back. Although credit cards dominate online payments today, electronic cash shows promise for the future.

We estimate a two-stage Heckman selection model of credit card adoption and use with a unique dataset that combines administrative data from the Equifax credit bureau and self-reported data from a representative survey of consumers. Higher-income consumers carry higher credit card balances, but they tend to repay those balances each month. Credit card revolvers have lower income and are less educated. Revolvers are twice as likely to use debit cards as credit cards for payments, but they carry much higher balances on their credit cards. The high cost of paying off credit card debt likely exacerbates existing inequalities in disposable income. Unlike the mortgage market, we find no evidence for lenders’ cutoff between subprime and prime consumers in the credit card market.

There has been extensive discourse on the topic of cashless payments, and their global adoption has witnessed exponential growth in recent years. Cash transactions pose certain challenges, notably the impracticality of managing physical currency and the restricted accessibility of financial institutions to withdraw cash. Multiple research studies have affirmed the positive influence of cashless payments on economic growth, thus highlighting their crucial significance. The present study aims to examine the effects of cashless payments on the economy of Sri Lanka. In particular, the investigation focuses on the measurement of economic growth using the real Gross Domestic Product (GDP), and the analysis of cashless payment systems through the employment of Real-time Gross Settlement System (RTGS), Cheque (CHE), Sri Lanka Interbank Payment System (SLIPS), and Internet Banking (IB), Mobile Banking (MB), Credit Card (CC), Debit Card (DC) transactions as representative indicators. The data utilized in this study is based on secondary sources in the form of time series data, spanning from quarter 01 of 2015 to quarter 3 of 2022. The AutoRegressive Distributed Lag (ARDL) model is then employed for the purpose of data analysis. Upon conducting an analysis of the long-term impact of various payment methods on economic growth, it is determined that RTGS (94% of total digital transaction) and SLIPS have a statistically significant positive relationship with economic growth. Conversely, IB exhibits a significant negative relationship which requires targeted improvements. Notably, there is no significant impact on economic growth observed with respect to the CHE, CC, DC, and MB indicating the need for technological advancements and integration. In the short run, it can be inferred that there is a significant positive correlation between RTGS, CHE, IB, and MB. Conversely, the analysis indicates a significant negative relationship between the SLIPS and DC payment methods. It is worth noting that the analysis does not reveal any significant association between the CC payment method and economic growth. Hence, this study conclude that digital currencies have on overall positive impact on short and long run in Sri Lankan economic growth and highlights the importance of prioritizing efficient payment systems that foster the economic growth while addressing the challenges with less effective methods. Policy makers and financial institutions can enhance the efficiency of payment ecosystems, ultimately driving sustainable economic growth.

The objective of this research is to identify and analyze the factors that of influence of consumers The purpose of this research is to analyze and determine the factors that influence consumer’s impulse buying behavior in mini market (convenience store) based on influence of variable store atmosphere, in-store browsing, in-store layouts, salesperson, promotional approach, reference group, use payment card and shopping emotion. This study attempts to analyze post-purchase consumer regret and investigates the influence of impulse behavior to post purchase regret.The sample was collected and analyzed from 244 respondents of convenience store shoppers in ages in Greater Jakarta region. Structural Equation Modeling (SEM) and AMOS were used for data analysis and hypotheses testing.Results indicate that there is a significant effect of the impulse buying behavior in the four variables; the role of salesperson, sales promotion, the participation of reference groups and payments made by debit card. As a result, this study addresses concerns about disappointed consumers after making an impulsive purchase.This study emphasizes the importance of friendly and ready to help the consumers in sales person’s role to encourage consumers to make impulsive purchases. The readiness and friendliness of employees in serving consumers can occur when companies often provide training to employees.Employees must pay particular attention and effort put into effect reward and punishment system that can increase work motivation. Furthermore, reference groups have an effect on impulsive buying behavior, and the tendency of consumers to shop more is high when accompanied with a mutual friend. In addition to sales person and reference group, promotions made by the store can also attract consumers and encourage them to make purchases impulsively. Additional value that can encourage the purchase of impulsive payment system is by using a debit card instead of credit card. In further research, the convenience store consumers do not make purchases in large quantities so payment using credit card does not give a significant effect while consumers can use a debit card in lieu of cash. Other research results show consumers regret after making an impulsive purchase. The negative consequence of consumer disappointment is that consumers become disloyal even spreading negative word of mouth. Thus, the company needs to explore these impacts in more detail and determine the factors that can reduce consumer disappointment This study examines the factors that cause and impact impulse buying behavior. The study was conducted at convenience stores in Greater Jakarta region. The results showed the impact of impulse buying behavior on consumer regret after doing impulse buying.