Consumer rationality and credit card pricing: An explanation based on the option value of credit lines

2004 ◽  
Vol 25 (5) ◽  
pp. 243-254 ◽  
Author(s):  
Sangkyun Park
Keyword(s):  
Credit Card ◽  
Option Value ◽  
Credit Lines ◽  
Credit Card Pricing

An Empirical Analysis of UK Credit Card Pricing

2010 ◽  
Vol 37 (2) ◽  
pp. 101-117 ◽  
Author(s):  
Kevin Amess ◽  
Leigh Drake ◽  
Helen J. Knight
Keyword(s):  
Empirical Analysis ◽  
Credit Card ◽  
Credit Card Pricing

CONSUMER PREFERENCES AND REGULATIONS IN CREDIT CARD MARKETS: EVIDENCE FROM TURKEY

2021 ◽  
pp. 1-27
Author(s):  
G. GULSUN AKIN ◽  
AHMET FARUK AYSAN ◽  
EZGI ÖZER ◽  
LEVENT YILDIRAN
Keyword(s):  
Market Power ◽  
Credit Card ◽  
Choice Model ◽  
Consumer Preferences ◽  
Credit Cards ◽  
Differentiated Products ◽  
Private Banks ◽  
Credit Card Market ◽  
Credit Card Pricing ◽  
Public Banks

In this paper, we analyze the demand side of the credit card market. Using unique survey data and a discrete choice model, we uncover consumer preferences for all price and nonprice features of credit cards. Our results provide evidence for an alternative explanation for the credit card pricing puzzles. We show that consumers view credit cards as highly differentiated products with both bank-level and card-level nonprice features. When selecting their credit cards, they predominantly prioritize these nonprice features over prices. Although private banks charge higher prices for their credit card services than other banks, the majority of consumers choose them as issuers due to their bank-level and card-level nonprice features. Consumers who prioritize prices tend to choose the credit cards of participation or public banks. Widespread branch/automated teller machine networks as bank-level features and installments, bonuses/rewards/miles and the prestige of the card as card-level features are particularly effective in consumers’ decisions to choose private banks as issuers. Such strong preferences for nonprice features seem to furnish private banks with market power. Hence, we argue that underlying issuers’ market power is also this differentiated nature of credit cards, for which regulatory measures are not self-evident.

Credit Card Processing

2007 ◽  
Vol 38 (11) ◽  
pp. 54
Author(s):  
JOSEPH S. EASTERN
Keyword(s):  
Credit Card

The Credit Card Effect on Consumption and Saving

2009 ◽  
Author(s):  
Mark Schneider ◽  
Jeffrey Schneider
Keyword(s):  
Credit Card ◽  
Consumption And Saving
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