A Study of Premium Credit Card Users for their Choice
A Study of Premium Credit Card Users for their Choice
Abstract
As a result of the global financial crisis, the credit card industry has undergone a radical transformation. During the slow recovery of the industry, consumer preferences changed as well. When it came to interest rates and fees, consumers used to prefer low rates and fees, but now they are more concerned with building a mutually beneficial relationship with credit card issuers. In the new economy, reward programmed have emerged as an important tool for establishing a long-term relationship between cardholders and card issuers. Customers no longer have to carry around multiple cards, but instead only need one. Card issuers have further customized the rewards programmed to meet the needs of their customers and create more value for the cardholders through the rewards.
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Introduction
India's credit card industry grew at one of the fastest rates between 2003 and 2008. During the financial crisis of 2008, the number of customers who defaulted on their loans increased dramatically. As a result, credit card issuers were forced to reduce the number of new customers they acquired and consolidate their customer bases. As a result, credit card companies were forced to close inactive accounts and impose strict penalties on defaulting customers. But now, the credit card industry has undergone a major transformation.
A new strategy by card issuers has resulted in an increase in the number of new customers being attracted. At this point, it's critical for credit card companies to understand consumer preferences. In the past, credit card issuers competed on the basis of interest rates and fees charged by their cards. As a result of this, the annual membership fee and interest charged for late payments were lowered in order to gain a larger share of the market share. However, as competition increased, card issuers began to look for new alternatives to the traditional credit card system. It was no longer enough for card issuers to compete solely on the basis of rates and charges.
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Conclusion
The credit card industry, which is recovering from the effects of the global financial crisis, has undergone a radical transformation. Consumer preferences are changing as the industry slowly recovers. Instead of low interest rates and other benefits, consumers are now more interested in reward programmed. Now, instead of having multiple cards as they did before the financial crisis, they are consolidating their spending into a single card that offers them customized and valuable reward programmers.
In this ever-changing and evolving industry, it's critical to understand customer preferences for credit card reward programmers. When it comes to credit card reward programmed, convenience, aspirational value, cash value, redemption choice and relevance are the most important factors. In total, these factors account for 68.2% of the variance. For the Credit Card Reward Program, 'Convenience' emerged as the most important dimension, explaining 19.28 percent of the variance. When it comes to convenience, there are four factors that can be considered.
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