You are on page 1of 4


Nirmala. R1, Sonu2

sst. Prof., Commerce Department, Govt. College, Hisr, Hryn, (India)

Over the past few decades, a small fragment of plastic has revolutionized the way consumers pay. Rise in
disposable income, introduction of new products and services, increased travel and growth of the entertainment
sector has had an impact on the use of plastic money. The present paper makes an attempt to understand the
consumer preferences and attitude towards the use of plastic money. The paper is an exploratory-cum-
descriptive research that is primarily based on the data collected from 200 respondents and duly investigates
the acceptability of the cards among the Indian consumers and the factors affecting it.

Keywords: Consumer Attitude, Plastic Money


In India, as in other countries around the globe, an organized mode of payment has emerged over time from the
barter system to the more convoluted forms of monetary arrangements. The prevalent mode of settlement across
India in the 20th century has been coins, cash and cheques. As we move ahead into the 21st century, payment
through cash and cheques itself has encountered a transfiguration. It has moved from being a physical paper-
based transfer of value to a virtual electronic one. Usage of plastic money has come as a form of amenity to
financial institution customers. Electronic service is becoming a feasible option for dealings between financial
service providers and their clients. In the study, we are typically focusing only on credit cards and debit cards in
order to find out the effectiveness of such cards in real life and factors affecting the consumer perception
towards the plastic money are discussed. A research design has been used based on the collected data to predict
the consumers acceptance behavior. Finally, the outcomes are analyzed and presented.


To assess the level of adoption and use of plastic money as payment system.
To analyze the factors for adoption of plastic money that replaces the paper or cash money.
To find problems of using plastic money.


The research study is Exploratory in nature. The Study is been carried out by taking a survey of 200 respondents
by Stratified Random Sampling Method from a city of Hissar by using structured questionnaire and interview
technique. The sampling frame that is used is within the boundaries of Hissar Municipal Corporation. Secondary
data is collected through reference books, research papers, articles, and websites.

1016 | P a g e
Type of card possessed by respondents
S No. Parameters Percentage
1 Debit Card 60%
2 Credit Card 15%
3 Both 22%
4 None 3%
From table it can be seen that majority of respondents use plastic money in the form of debit card. However,
some use both debit and credit cards. The preference of the specified card makes a great amount of impact on
the spending patterns of various consumers. The preference of debit cards over credit card marks a strong sense
of favouritism among the respondents. According to table majority of respondents prefer using Debit card over
Credit card as they feel that the use of Debit card is more beneficial than Credit card in terms of cash back
policy, control over spending and security. However some of are the opinion that both Debit and Credit cards
have their own benefits.
Benefits of the Debit/Credit cards according to respondents (Figures in percentages)
S. No Parameters Strongly Agree Satisfactory Disagree Strongly
agree Disagree
1 Convenience 54 12 20 7 7
2 Security 17 3 23 46 11
3 No 9 6 12 21 52
transaction cost
4 Accessibility 32 31 20 8 9
5 Portability 46 31 3 15 5

From table it can be seen that majority of respondents strongly agree to the fact that plastic money is convenient,
easily accessible and very portable. However around some of the respondents completely disagree to the secure
and no transaction cost nature of the Debit/ Credit cards. The major preference of debit card is mainly due to the
convenience and easy portability. However the high transaction or charges of using the plastic money leads to
more of cash payments. Some banks have a cost as high as up to 10%. Such high rates when billed with the
transaction amount spend leads to a big hole in the pockets of consumers thus their preference of debit card is
justified completely.

1017 | P a g e
Purpose of Usage of Card According to Respondents
1 Apparel 20%
2 Electricity bills/Phone bills 16%
3 Banking 13%
4 Consumer Durables 11%
5 Electronics 13%
6 Investments 5%
7 Jewellery 6%
8 Online transactions 16%
From figure it can be seen that majority of respondents prefer using plastic money for buying apparels, paying
electricity bills/phone bills and for online transactions. These are all day to day transactions that require more
than the average cash payments. Use of Debit cards is convenient as they can be swiped anywhere with ease and
the deduction from respective bank account happens immediately unlike the credit cards where a swipe
generates a future liability of payment for the customer. The easy access to internet and site like Jabong, Myntra
and Amazon has led to the rise in apparel online shopping of the card users. However, they do not use plastic
money much for investment purposes which includes trading of securities on stock exchanges, purchase of
bonds/ debentures, purchase of jewellery etc.
Problems perceived by the respondents on possession of Plastic money
1. Insecurity 2.Fear of losing the card
3. Unnecessary formalities 4.High processing fees
5. Shops Using Other Vendors 6.Less Global Availability
7. Worn out Magnetic Strip 8. Increased Debt and High Interest Rates
9. Frauds:


1. The use of Plastic cards is more and more increasing for online payment.
2. Around 50% of payments of the customers are done through credit/Debit cards. Sample survey shows Debit
cards are preferred over credit cards.
3. The main reason for the increase in plastic money is that the customers are not a victim of a fraud.
4. The customers have rated that the telephonic payment option is average due to long timeliness and security
concern for CCV/PIN number.
5. Frequency of customers to visit the banks have become less.
6. The use of plastic cards has also been increased because banking industries has also provided the 24x7
customer service for their customers.
7. The factors for adoption of plastic money over the cash and paper money are Non- Discounts while shopping,
No hassles of carrying cash, Security of money, Hassle free EMIs ,Easy to use, Personal Loan on Credit Card .

1018 | P a g e

The study has clearly highlighted the advantage of instant transaction as one of the major factors favoring the
use of plastic money over real money by the population today. It has already been highlighted by the study that
convenience of not carrying cash and ease of transaction is one of the major psychologically influencing factors
that encourage the use of plastic money instead of real money. Additionally, the results of the study have also
stressed upon the convenience and ease of use while paying or shopping by plastic money. The saving of time
and the fact that the plastic money seems to be more portable also seems to further the cause of a possible
change in the scenario of money usage in the economy. On the other hand, Security comes forward as a major
cause for concern for the population using plastic money. Therefore, it is easy to conclude that the population is
ready as ever to use plastic money at a greater level due to its high levels of ease and convenience.


[1.] Goi C.L., 2005. E-banking in Malaysia: Opportunities and challenges. Journal of Internet Banking and
Commerce Vol. 10 No. 3, Dec 2005.
[2.] S. Rotchanakitumnuai, and M. Speece, Corporate customer Perspectives on Business value of Thai
Internet Banking. Journal of Electronic Commerce Research, 2004, Vol.5 No.4, p. 270-286
[3.] Anupama Sharma (2012), Plastic card frauds and the countermeasures: Towards a safer payment
mechanism, International Journal of Research in Commerce, It & Management, Vol. 2, No. 4.
[4.] Suneja H R (1994), Innovations in Banking Services, Himalaya Publishing House, pp.1-20.
[5.] Mandeep Kaur and Kamalpreet Kaur (2008), Development of Plastic Cards Market: Past, Present and
Future Scenario in Indian Banks, Asia-Pacific Business Review, Vol. IV, No.4, pp. 62-74, ISSN: 0973-
[6.] Manivannan P (2013), Plastic Money a way for cash Less Payment System, Global Research Analysis,
Vol. II, No. I.
[7.] Wonglimpiyarat Jarunee (2007), EPayment Strategies of Bank Card Innovations, Journal of Internet

1019 | P a g e