IDEAS home Printed from https://ideas.repec.org/p/bca/bocadp/09-8.html
   My bibliography  Save this paper

The Role of Convenience and Risk in Consumers' Means of Payment

Author

Listed:
  • Carlos Arango
  • Varya Taylor

Abstract

Using data from a 2004 survey of the Canadian public, the authors study the role of convenience and risk in consumers' use of cash relative to debit and credit cards. The authors find that consumers who perceive debit cards and credit cards to be more convenient and less risky than cash use them more frequently. Even at low levels of perceived risk, consumers shift substantially away from cash and towards alternative payment methods. However, the authors' results reveal that there exists a lower bound for which cards can substitute for cash. Also, as other studies have shown, the relative use of cash is higher among older, less-educated, lower-income consumers.

Suggested Citation

  • Carlos Arango & Varya Taylor, 2009. "The Role of Convenience and Risk in Consumers' Means of Payment," Discussion Papers 09-8, Bank of Canada.
    • Handle: RePEc:bca:bocadp:09-8
    as

    Download full text from publisher

    File URL: https://www.bankofcanada.ca/wp-content/uploads/2010/01/dp09-8.pdf
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Cologgi, Massimiliano, 2023. "The impact of regulation on retail payments security: Evidence from Italian supervisory data," Finance Research Letters, Elsevier, vol. 54(C).
    2. Egor Krivosheya & Polina Belyakova, 2019. "Financial innovations role in consumer behavior at Russian retail payments market," Proceedings of Economics and Finance Conferences 9511955, International Institute of Social and Economic Sciences.
    3. Martínez Ventura, Constanza, 2019. "El uso de efectivo y tarjetas débito como instrumentos de pago en Colombia," Revista Lecturas de Economía, Universidad de Antioquia, CIE, issue 90, pages 71-95, January.
    4. Constanza Martínez Ventura, 2019. "The use of cash and debit cards as payment instruments in Colombia," Lecturas de Economía, Universidad de Antioquia, Departamento de Economía, issue 90, pages 71-95, Enero - J.
    5. Arango, Carlos & Huynh, Kim P. & Sabetti, Leonard, 2011. "How do you pay? The role of incentives at the point-of-sale," Working Paper Series 1386, European Central Bank.
    6. Scott Schuh & Joanna Stavins, 2013. "How Consumers Pay: Adoption and Use of Payments," Accounting and Finance Research, Sciedu Press, vol. 2(2), pages 1-1, May.
    7. Charles M. Kahn & José M. Liñares-Zegarra & Joanna Stavins, 2017. "Are there Social Spillovers in Consumers’ Security Assessments of Payment Instruments?," Journal of Financial Services Research, Springer;Western Finance Association, vol. 52(1), pages 5-34, October.
    8. Kosse, Anneke, 2013. "Do newspaper articles on card fraud affect debit card usage?," Journal of Banking & Finance, Elsevier, vol. 37(12), pages 5382-5391.
    9. Joanna Stavins, 2013. "Security of retail payments: the new strategic objective," Public Policy Discussion Paper 13-9, Federal Reserve Bank of Boston.

    More about this item

    Keywords

    Bank notes;

    JEL classification:

    • E41 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Demand for Money
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bca:bocadp:09-8. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/bocgvca.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.