Perceived Barriers in the Adoption & Usage of Credit Cards in Pakistan Banking Industry

By Khalid, Junaid; Butt, Hasnain Safdar et al. | International Review of Management and Business Research, March 2013 | Go to article overview

Perceived Barriers in the Adoption & Usage of Credit Cards in Pakistan Banking Industry


Khalid, Junaid, Butt, Hasnain Safdar, Murtaza, Muhammad, Khizar, Usman, International Review of Management and Business Research


1. Introduction

The liberalization of the monetary sectors in Asia has resulted in the rapid propagation of credit card companies and financial companies providing other types of consumer credit. The credit card market in overall world has expanded drastically that the issuers of foreign countries has introduced mobile phone credit cards for the convenience of their customers.(Amin, 2008) This, coupled with the entry of foreign banks, has greatly increased the number of credit cards available, and hence such spending in Pakistan. Although credit card was introduced in Pakistan decades ago when Habib Bank, the largest bank in Pakistan, launched its gold card, but people had hardly know about this card because of its very limited issuance. Several years back, Master card was introduced by Allied Bank of Pakistan which also didn't receive that much appreciation. In 1994, Citibank had introduced its VISA Card and that was the turning point in the history of Plastic Money in Pakistan. Citibank did a tremendous job to edify people of Pakistan, as well as, financial industry about credit cards and its significance in today's world. It was their aggressive marketing and heavy investment in technology, that made deserving Citibank to be called the industry leader of Pakistan's credit card business. After the success of Citibank card, Muslim Commercial Bank, Bank of America, and National Bank of Pakistan had launched their credit cards. In the very near future we are expecting more local and international banks to enter and have success on the horizon of Pakistan's credit card business. The plastic money industry in Pakistan is one of the undeveloped ones. At this time, there are a few people which are using them or even are aware of its services. The majority of people does not consider it fruitful and part their ways from it.

The State Bank of Pakistan has taken several measures to enhance security of plastic money transactions in the country with a view to effectively address customer complaints and to ensure continued growth in the fields of e-banking and e-commerce. (State Bank of Pakistan, August 23, 2008) .

According to SBP report the tendency of number of cardholders is increasing. But the major portions of people are attracted toward debit cards. Acceptance of credit cards among the general audience has been quite low in comparison to debit cards and ATM cards. Still major proportion of population is not having credit card or avoid to use it even they have sufficient resources and affordability of credit cards. There is a need to explore the reasons of such problems in Pakistan as:

Why people are not attracted towards credit card.

Why cardholders are using their credit cards less frequently.

Whether there is discrepancy at card issuer's end or there are some constraints in customer's perception.

The aim of this study was twofold; first one was the identification of perceived barriers that cause low usage among cardholders and to explore factors which resist people to adopt credit card as a mean of payment. The second purpose was not to limit itself to identifying those perceived barriers but also to explain the relative significance of each attribute that has influence on customer's attitude. This study will be helpful for card issuing companies to adopt such strategies that will reduce the impact of perceived barriers, for the purpose of meeting nationwide as well as worldwide competition. The card issuer may get momentous information from the findings of this research that will be accommodating in designing their marketing strategies, which will position their product high in customer's mind.

2. Literature Review

Although there is substantial literature on credit card usage and adoption internationally but in Pakistan research work on plastic money is limited and don't provide insight of consumer attitude. There is a need to explore the reason of consumer attitude about 'Why they are not attracted toward plastic money, especially credit card? …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Note: primary sources have slightly different requirements for citation. Please see these guidelines for more information.

Cited article

Perceived Barriers in the Adoption & Usage of Credit Cards in Pakistan Banking Industry
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
Items saved from this article
  • Highlights & Notes
  • Citations
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Search by... Author
    Show... All Results Primary Sources Peer-reviewed

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.