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Journal articles on the topic 'Personal Consumer credit'
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1
Jureviciene, Daiva, Kamile Taujanskaite, and Vytaute Sukacevskyte. "Indirect Factors Affecting Personal Solvency: Empirical Analysis Of Lithuanian Consumer Credit Market." European Scientific Journal, ESJ 12, no. 1 (January 29, 2016): 157. http://dx.doi.org/10.19044/esj.2016.v12n1p157.
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The aim of this article is to analyze the interrelationship between solvencies of consumer credits customers and indirect factors such as borrowing motivation as well as demographical and socioeconomic factors characterizing the borrowers’ personality. The results of this research were obtained using statistical software SPSS. Systemic scientific literature analysis, correlation analysis of randomly selected records from consumer credit contracts, Student t-test criteria application for testing hypothesis, analysis of Levine's and Pearson’s correlation criteria are used in the article. In addition, previously carried out expert evaluation research results were compared with actual consumer credit contracts data. The novelty of this research is classification of factors influencing personal solvency into direct and indirect. The influence of indirect factors (demographic, socioeconomic and borrowing motives) has been investigated in risky consumer credit market of Lithuania. The results show that the most influencing indirect factor is the purpose of consumer credit.
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Aggarwal, Nikita. "THE NORMS OF ALGORITHMIC CREDIT SCORING." Cambridge Law Journal 80, no. 1 (March 2021): 42–73. http://dx.doi.org/10.1017/s0008197321000015.
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AbstractThis article examines the growth of algorithmic credit scoring and its implications for the regulation of consumer credit markets in the UK. It constructs a frame of analysis for the regulation of algorithmic credit scoring, bound by the core norms underpinning UK consumer credit and data protection regulation: allocative efficiency, distributional fairness and consumer privacy (as autonomy). Examining the normative trade-offs that arise within this frame, the article argues that existing data protection and consumer credit frameworks do not achieve an appropriate normative balance in the regulation of algorithmic credit scoring. In particular, the growing reliance on consumers’ personal data by lenders due to algorithmic credit scoring, coupled with the ineffectiveness of existing data protection remedies has created a data protection gap in consumer credit markets that presents a significant threat to consumer privacy and autonomy. The article makes recommendations for filling this gap through institutional and substantive regulatory reforms.
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Hendarsyah, Decky. "Analisis Perilaku Konsumen Dan Keamanan Kartu Kredit Perbankan." JPS (Jurnal Perbankan Syariah) 1, no. 1 (April 13, 2020): 85–96. http://dx.doi.org/10.46367/jps.v1i1.204.
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This paper discusses consumer behavior and banking credit card security. Credit cards are present as one of the non-cash payment methods that simplify business and financial matters so that many consumers use them. After review and discussion, it was found that consumer behavior in using credit cards is more dominated by personal factors. With the drive for needs and lifestyle, many consumers are interested in using a credit card. The bank as a credit card issuer also provides sophisticated and multi-layered security features. Even so, it still has a gap for the presence of fraud crime in various ways and forms. In order for credit cards to be safe from crime and fraud, consumer behavior must be changed by maintaining confidentiality, caution and vigilance in conducting transactions.
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Gao, Lu, and Jian Xiao. "Big Data Credit Report in Credit Risk Management of Consumer Finance." Wireless Communications and Mobile Computing 2021 (June 15, 2021): 1–7. http://dx.doi.org/10.1155/2021/4811086.
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Traditional consumer finance is a modern financial service method that provides consumer loans to consumers of all classes. With the gradual improvement of China’s credit reporting system, big data credit reporting has effectively made up for the lack of traditional credit reporting and has been widely used in the consumer finance industry. In this context, the in-depth analysis of the specific application of big data credit reporting in the credit risk management of consumer finance and the strengthening of the research on the application of big data credit reporting in the credit risk management of consumer finance are urgently needed to be resolved in the economic and financial theoretical and practical circles’ problem. This article mainly studies the research on credit risk management of consumer finance by big data. The experimental results of this paper show that the model has a good forecasting ability, can distinguish between normal loan customers and default loan customers, and is suitable for practical personal credit risk control business. The prediction accuracy of the default model of the fusion model is 97.14%, and the default rate corresponding to the actual business is 2.86%. By combining the risk items such as the blacklist and gray list in the Internet finance industry, the bad debt rate and illegal usury can be well controlled to meet industry supervision.
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Dhika, Harry, and Fitriana Destiawati. "Application of Data Mining Algorithm to Recipient of Motorcycle Installment." ComTech: Computer, Mathematics and Engineering Applications 6, no. 4 (December 1, 2015): 569. http://dx.doi.org/10.21512/comtech.v6i4.2192.
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The study was conducted in the subsidiaries that provide services of finance related to the purchase of a motorcycle on credit. At the time of applying, consumers enter their personal data. Based on the personal data, it will be known whether the consumer credit data is approved or rejected. From 224 consumer data obtained, it is known that the number of consumers whose applications are approved is 87% or about 217 consumers and consumers whose application is rejected is 16% or as much as 6 consumers. Acceptance of motorcycle financing on credit by using the method of applying the algorithm through CRIS-P DM is the industry standard in the processing of data mining. The algorithm used in the decision making is the algorithm C4.5. The results obtained previously, the level of accuracy is measured with the Confusion Matrix and Receiver Operating characteristic (ROC). Evaluation of the Confusion Matrix is intended to seek the value of accuracy, precision value, and the value of recall data. While the Receiver Operating Characteristic (ROC) is used to find data tables and comparison Area Under Curve (AUC).
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Hyman, Louis. "Debtor Nation: How Consumer Credit Built Postwar America." Enterprise & Society 9, no. 4 (December 2008): 614–18. http://dx.doi.org/10.1017/s1467222700007552.
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It is difficult to consider debt as having a history, because it seems like debt might be, as one popular historian of money in 1917 described it, a “semi-slavery . . . [which] existed before the dawn of history, and it exists to-day.” People, in a certain sense, have always lent money to one another: to a wayward brother, across a saloon bar, to a coworker. But even by 1917, as that popular history was written in the midst of world war, the ancient personal relationship of personal debt was changing into a modern impersonal one. My dissertation is about how what we call personal debt, that is debt incurred by individuals and not by businesses, went from being owed to other people to being owed to institutions, and what this has meant at the largest level about American capitalism.
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Carlin, Bruce, Arna Olafsson, and Michaela Pagel. "Generational Differences in Managing Personal Finances." AEA Papers and Proceedings 109 (May 1, 2019): 54–59. http://dx.doi.org/10.1257/pandp.20191011.
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In this article, we provide a descriptive account of how people from different generations vary in their use of financial management technology, their access credit markets, and how they finance consumption and incur financial costs and penalties. We use a detailed panel of transaction-level data from Iceland on individual spending, incomes, balances, and credit limits from a personal financial management software. We find that technology adoption is faster for millennials, but use of consumer credit and financial penalties are higher for older generations. While the “coholding puzzle” exists for all people, it appears to be more severe for baby boomers.
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White, Michelle J. "Bankruptcy Reform and Credit Cards." Journal of Economic Perspectives 21, no. 4 (November 1, 2007): 175–99. http://dx.doi.org/10.1257/jep.21.4.175.
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From 1980 to 2004, the number of personal bankruptcy filings in the United States increased more than five-fold, from 288,000 to 1.5 million per year. By 2004, more Americans were filing for bankruptcy each year than were graduating from college, getting divorced, or being diagnosed with cancer. In 2005, the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) became law. It made bankruptcy law much less debtor-friendly. Personal bankruptcy filings fell to 600,000 in 2006. This paper explores why personal bankruptcy rates rose, and will argue that the main reason is the growth of “revolving debt”—mainly credit card debt. It explains how the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) of 2005 altered the conditions of bankruptcy. Finally, this essay considers the balances that need to be struck in a bankruptcy system and how the U.S. bankruptcy system strikes these balances in comparison with other countries. I argue that a less debtor-friendly bankruptcy policy should be accompanied by changes in bank regulation and truth-in-lending rules, so that lenders have a greater chance of facing losses when they supply too much credit or charge excessively high interest rates and fees.
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Glover, Lisa. "Creditworthy: A History of Consumer Surveillance and Financial Identity in America by Josh Lauer." Journal of Intellectual Freedom and Privacy 2, no. 3-4 (April 9, 2018): 33. http://dx.doi.org/10.5860/jifp.v2i3-4.6482.
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In September of 2017 Equifax, one of the three major consumer credit reporting agencies in the United States, announced its system security had been breached and confidential consumer information may have fallen into the hands of hackers. Although reports of system intrusions are released almost daily, this breach was of particular significance: sensitive data, including personal, identifying and financial data, was compromised for an estimated 143 million consumers in the United States. Just this week, Equifax further disclosed another 15 million client records were breached in the United Kingdom. Any consumer who has received credit of any kind is familiar with the big three credit reporting agencies—Equifax, TransUnion, and Experian—as these agencies house the financial identities American consumers. With such vast data stores, credit reporting agencies are prime and potentially profitable targets for hackers. All the information a hacker needs to steal a financial identify of a victim resides in the agencies’ files. Clearly, credit reporting agencies play a critical role in the financial marketplace. How these agencies became the powerful guardians and suppliers of consumer financial information is the topic of Josh Lauer’s book, Creditworthy: A History of Consumer Surveillance and Financial Identity in America. This is the first book authored by Lauer, who is an associate professor of media studies at the University of New Hampshire with specialties in media history and theory, communication technology, consumer and financial culture, and surveillance. Lauer relates in great detail how we moved from a society of relationships and human interaction to one of faceless data designed to symbolize character and reputation. Lauer’s history takes us from a time when Americans desired access to goods and services more than they valued confidentiality, to the financial privacy concerns of these surveillance systems today.
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Ferreira, Fernando A. F., Ieva Meidutė-Kavaliauskienė, Edmundas K. Zavadskas, Marjan S. Jalali, and Sandra M. J. Catarino. "A Judgment-Based Risk Assessment Framework for Consumer Loans." International Journal of Information Technology & Decision Making 18, no. 01 (January 2019): 7–33. http://dx.doi.org/10.1142/s021962201850044x.
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Credit to personal consumption is an important activity of the financial system and crucial to the socioeconomic development of a country. It is important, therefore, that the methods and techniques used to evaluate consumer credit risk be as efficient and informative as possible, in order to strengthen decisions to approve or reject credit and promote sustainable economic growth. This study aims to create a multiple criteria expert system which integrates cognitive maps and the measuring attractiveness by a categorical-based evaluation technique (MACBETH) to create a complementary framework for consumer credit risk assessment. The results show that this integrated approach allows the evaluation process of consumer credit risk to be more informed and transparent, providing value for the evaluation processes of this type of credit application as a result of the privileged contact established with a panel of credit analysts. Advantages, limitations, and managerial implications are also discussed.
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Matos, Celso Augusto de, Valter Vieira, Katia Bonfanti, and Frederike Monika Budiner Mette. "Antecedents of indebtedness for low-income consumers: the mediating role of materialism." Journal of Consumer Marketing 36, no. 1 (January 14, 2019): 92–101. http://dx.doi.org/10.1108/jcm-09-2017-2352.
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PurposeThe purpose of this is to propose a model in which materialism is a mediator of the effects of self-esteem, impulsiveness, attitude toward debt, attitude toward credit card and economic vulnerability on consumer indebtedness. The effects of financial knowledge, financial ability, credit card use and demographic variables are also taken into account.Design/methodology/approachSurvey data from a sample of 1,245 low-income consumers from Brazil were used to test the hypotheses using structural equation modeling.FindingsFirst, materialism has a significant effect on consumer indebtedness; at the same time, it is influenced by self-esteem, impulsiveness and attitude toward debt. Second, materialism acts as a mediator, e.g. higher impulsiveness triggers materialism, which influences debt level. Third, indebtedness is higher for women and those who use a higher number of credit cards and are more educated.Social implicationsFinancial education programs should work to increase individual’s perceived ability to manage money, as the individuals who feel less able to manage their personal finances alone (i.e. lower financial ability) presented higher indebtedness.Originality/valueThis study investigates consumer indebtedness by addressing factors that have been analyzed independently in the literature. The research combines psychological, financial and economic factors with credit card use and demographic variables to explain consumer indebtedness. Moreover, the study supports the mediating role of materialism for the antecedents of consumer indebtedness, e.g. impulsiveness and attitude toward debt.
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Han, Ping, and Jia Jia Chai. "The Application of K-Means in Personal Credit Analysis." Advanced Materials Research 403-408 (November 2011): 2461–64. http://dx.doi.org/10.4028/www.scientific.net/amr.403-408.2461.
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In this paper, we use K-means algorithm to realize dynamic clustering for the information of personal credit card bills, and through the statistical analysis of the results, we can get the analytics of the general trend of consumer behavior completely. In the experiment, we use K-means Algorithm to implement the clustering and analyze the experimental results which show that the results of this clustering can play a certain role in the analysis of the credit habit of discreditable users and high quality ones.
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Chen, Mo, and Jens Grossklags. "An Analysis of the Current State of the Consumer Credit Reporting System in China." Proceedings on Privacy Enhancing Technologies 2020, no. 4 (October 1, 2020): 89–110. http://dx.doi.org/10.2478/popets-2020-0064.
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AbstractThe Chinese Social Credit System (SCS), known as the first national digitally-implemented credit rating system, consists of two parallel arms: a government-run and a commercial one. The government-run arm of the SCS, especially efforts to blacklist and redlist individuals and organizations, has attracted significant attention worldwide. In contrast, the commercial part has been less often in the public spotlight except for discussions about Zhima Credit.The commercial arm of the SCS, also referred to as the Consumer Credit Reporting System (CCRS), has been under development for about two decades and took a major step forward in 2015 when 8 companies were granted permission to implement pilot consumer credit reporting programs. This development fundamentally increased the reach and impact of the SCS due to these companies’ sizable customer base and access to vast troves of consumer-related information.In this paper, we first map the Chinese CCRS to understand the actors in the credit reporting ecosystem. Then, we study 13 consumer credit reporting companies to examine how they collect and use personal information. Based on the findings, we discuss the relationship between the CCRS and the SCS including the changes in the power relationships between the government, consumer credit reporting companies and Chinese citizens.
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Usman, Muhammad, and Nabeel Taj Ghouri. "Reasons and Causes that Prevent Customers from Buying Consumer Banking Products in Pakistan." International Journal of Accounting and Financial Reporting 1, no. 1 (December 31, 2014): 549. http://dx.doi.org/10.5296/ijafr.v4i2.6868.
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Consumer banking refers to that banking products and services which are directly given by banks to consumers that are personal loan, auto loan, house loan and credit card. . Customers face some problems while buying consumer banking products and services, such as high interest rate, lack of awareness, inappropriate service, arrangement of securities and procedural complications. This study aims to analyze the relationship between perceived problems and consumer banking products. Survey based methodology was used for data collection. For this purpose a close ended questionnaire was designed. The target population was Lahore Pakistan. Interest rate, customer service, security issues and procedural complications are proven to be the problems faced by the customers while buying consumer banking products. But lack of awareness proved to be wrong which means that respondents are aware of consumer banking products.
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Olney, Martha L. "When Your Word Is Not Enough: Race, Collateral, and Household Credit." Journal of Economic History 58, no. 2 (June 1998): 408–31. http://dx.doi.org/10.1017/s0022050700020568.
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Black families included in the 1918/19 BLS Consumer Purchases Survey used installment credit more frequently and merchant credit less frequently than White families. Economic and demographic characteristics explain the racial difference for installment but not for merchant credit. I argue greater demand for installment credit by Black families was satisfied because repossession of collateral upon buyer default overcame merchants' personal prejudice with regard to creditworthiness, but absence of tangible collateral impacted the availability of merchant credit. Low use of merchant credit can account for relatively high interwar saving rates for low-income Black families.
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Finn, Margot. "Debt and credit in Bath's court of requests, 1829–39." Urban History 21, no. 2 (October 1994): 211–36. http://dx.doi.org/10.1017/s0963926800011032.
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Historians have long recognized the central role of debt and credit for producers, retailers and consumers in the later eighteenth and early nineteenth centuries. Against a background characterized by persistent shortages of specie, limited banking facilities and erratic transport mechanisms, the speculative impulse that fed the expanding economy drew sustenance from a proliferation of instruments of private credit — notably bills of exchange, promissory notes, and accommodation bills — which, together with an increase of trade credit to retailers and their customers, served to promote and intertwine the industrial, commercial and consumer revolutions. ‘At any one time any business owed and was owed many goods caught up in the process of exchange’, Julian Hoppit observes of the later decades of the eighteenth century. ‘All businessmen were creditors and all businessmen were debtors.’ As trade and manufacture increased in English towns and cities, extended chains of indebtedness multiplied the economic links both between individual producers, retailers or consumers and among these sectors of the economy. Thus in Lancashire innkeepers were the debtors of maltsters, brewers and wine merchants, but were the creditors of shopkeepers, who in turn extended webs of consumer credit to sawyers and carpenters, artisans typically indebted (in their capacity as producers) to the master builders for whom they laboured in Liverpool's shipyards. Based on personal faith rather than tangible securities, these varied forms of private credit were notoriously unstable. Broad-based financial crises fuelled by the failure of private credit became commonplace in the last three decades of the century, and persistently disrupted economic life into the Victorian period.
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Erdawati, Erdawati, and Mai Yuliza. "THE EFFECT OF CONSUMER BEHAVIOR PURCHASE GOLD CREDIT PRODUCTS IN BANK MANDIRI SYARIAH." UNES Journal of Social And Economics Research 3, no. 1 (June 30, 2018): 014. http://dx.doi.org/10.31933/ujser.3.1.014-020.2018.
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The purpose of this research is to know the influence of consumer behavior such as cultural factors, social factors, personal factors and psychological factors to the decision to purchase gold credit products at Bank Mandiri Syariah in Pasaman Barat Regency with the samples of 30 peoples. The sampling technique is by census. The research instrument is questionnaires. The data obtained then processed using multiple linear regresion analysis technique using spss. Testing statements conducted with the validity test and reliability test, classical assumption testing consisting of the test normality, linearity and heterokesidasitas. The test of multiple linear regression analysis showed that each variable used in this study has regression coefficient which can be made into a multiple regression equation as follows Y = 0,063 + 0,218X1 + 0,035X2 + 0,201X3 + 0,917X4, it can be concluded that culture factors and social factors have a positive influence on the purchase decision of gold credit products, while personal factors and psychological factors have a positive and significant influence on consumer decisions choosing gold credit products at Bank Syariah Mandiri.
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Huang, Chin-Wen, and Chun-Pin Hsu. "Using Online Games To Teach Personal Finance Concepts." American Journal of Business Education (AJBE) 4, no. 12 (November 22, 2011): 33–38. http://dx.doi.org/10.19030/ajbe.v4i12.6611.
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This case study explores the use of online games to teach personal finance concepts at the college level. A number of free online games targeting such topics as budgeting and saving, risk and return, consumer credit, financial services, and investments were introduced to the experimental group as homework assignments. Statistical results indicate that integrating online games into coursework significantly enhanced student learning outcomes. We suggest extending our successful experience to groups of people who need financial knowledge the most.
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Gritten, Adèle. "New insights into consumer confidence in financial services." International Journal of Bank Marketing 29, no. 2 (March 1, 2011): 90–106. http://dx.doi.org/10.1108/02652321111107602.
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PurposeA paradigm shift in consumer confidence has taken place with the worst recession on record forcing people to evaluate their personal and household finances. This paper seeks to explore the extent to which consumer confidence has been tarnished, and how it has evolved post‐recession. It aims to take both retrospective and prospective views on what has changed in the British psyche since the credit crunch, looking at where new confidences have been found and where old confidences have been lost, and hypothesising about the extent to which consumer behaviour will remain constant or further change against a likely backdrop of continuing financial instability.Design/methodology/approachThis paper is based on a variety of proprietary quantitative research surveys conducted by YouGov plc.FindingsThis paper provides new insights into consumer confidence, including, but not limited to: demonstrating the harsh realities of more people being in financial difficulty now than 18 months ago, and its impact on confidence; looking at which aspects of household expenditure and budgets have been hardest squeezed, and what that means for short‐ and medium‐term futures; analysing the extent to which the generally lower level of available credit makes consumers more or less reliant on borrowing as a way of life, and the associated impact on confidence and decision making/financial planning prioritisation; exploring the real fears and concerns people have about their future finances; and exploring consumer financial hopes and aspirations in a post‐recessionary climate.Originality/valueFindings from bespoke research offer hitherto unpublished and statistically valid results on the extent to which consumers have coped with and embraced the aftermath of the recession, and, moreover, how that might manifest itself in terms of future consumer confidence in financial services.
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Carlsson, Hanna, Stefan Larsson, Lupita Svensson, and Fredrik Åström. "Consumer Credit Behavior in the Digital Context: A Bibliometric Analysis and Literature Review." Journal of Financial Counseling and Planning 28, no. 1 (2017): 76–94. http://dx.doi.org/10.1891/1052-3073.28.1.76.
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This literature review seeks to map the state of research on the effects of digitization on personal financial behavior and management through a bibliometric analysis and a systematic literature review. The findings indicate that current knowledge is primarily based on perspectives of actors in commerce and systems development. More research is needed on how personal financial behavior change in relation to digital technology, the vulnerability of children and adolescents, and the links between changes in credit behavior and indebtedness. Financial counseling could benefit from an awareness of young adults vulnerability as digital consumers and an extended perception of financial literacy that encompasses requirements of digital society. Policymakers need to be aware of the consequences of digital measurability.
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Дмитриева and Olga Dmitrieva. "Short credits and micro-loans for individuals: advantages, disadvantages, the main options." Vestnik of Kazan State Agrarian University 9, no. 3 (December 14, 2014): 11–15. http://dx.doi.org/10.12737/6505.
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In everyday life, unforeseen or unplanned purchases lead to a desire to borrow a small amount on the short term. This problem is known to many people. Currently, the only viable option is short-term loans from commercial banks or micro-loans provided by microfinance institutions. They have their own advantages and disadvantages, and it is designed for a specific audience of potential borrowers. Short-term bank credit is available at any bank that deals with consumer credit borrowers. There are four main types of loans in the short term: a term loan; line of credit; overdraft on a personal map; quick loans. The potential borrower has the ability to get a loan only if certain conditions of the credit institution. Microfinance institutions are engaged in issuing microloans. There are two main types of micro-loans to individuals: consumer loans for a period of one year; term loans to payday. In this type of lending the solvency of the borrower is not evaluated, not studied his income, credit history is not analyzed. The creditworthiness of the borrower is assessed through informal criteria. Despite some limitations and high cost, short-term loans and micro-loans is a great opportunity to purchase desired and necessary goods or solve other consumer problems.
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James, Deborah. "MONEY-GO-ROUND: PERSONAL ECONOMIES OF WEALTH, ASPIRATION AND INDEBTEDNESS." Africa 82, no. 1 (January 19, 2012): 20–40. http://dx.doi.org/10.1017/s0001972011000714.
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ABSTRACTConsiderable attempts to create a single economy of credit, in part through regularizing microlenders (especially the much-demonized loansharks or mashonisas), have been made by the South African government, notably through the National Credit Act. This article explores how borrowing and indebtedness are seen from the point of view of consumers and of those who aim to protect them. It suggests that we should speak of moneylending rather than moneylenders; that lending is often done by groups rather than by individuals (in a variant of the well-known stokvel); and that it may represent a response to so-called ‘formalization’ (Guyer 2004) of financial arrangements by those who have considerable experience of this, rather than being a bulwark against it. Based on research in Gauteng and Mpumalanga, the article critically explores prevalent stereotypes of the ‘overindebted consumer’ and the ‘black diamond’, seeking evidence both in support and in refutation of them. It discusses those factors which are conducive to and those which obstruct the achieving of the status of upwardly mobile – and simultaneously overindebted – person; demonstrates that aspiration and upward mobility, and the problems of credit or debt that accompany these, have much longer histories; and that these matters can give us insights into the contradictory character of the South African state. Its ‘neo-liberal’ dimension allows and encourages free engagement with the market and advocates the freedom to spend, even to become excessively acquisitive of material wealth. But it simultaneously attempts to regulate this in the interests of those unable to participate in this dream of conspicuous consumption. Informalization intensifies as all manner of means are devised to tap into state resources. Neo-liberal means are used to ensure the wide spread of redistribution.
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Anderson, Elisabeth, Bruce G. Carruthers, and Timothy W. Guinnane. "An Unlikely Alliance: How Experts and Industry Transformed Consumer Credit Policy in the Early Twentieth Century United States." Social Science History 39, no. 4 (2015): 581–612. http://dx.doi.org/10.1017/ssh.2015.72.
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Despite the recently demonstrated importance of consumer credit for the economic health of nations and families, little is known about the history of consumer credit markets and their regulation. An important chapter in the history of consumer credit regulation came between 1909 and 1941, when policy experts at the Russell Sage Foundation (RSF) engaged in a national campaign to transform small loan markets and policy in the United States. Concentrating its efforts on state-by-state passage of the Uniform Small Loan Law, the foundation's political success hinged upon an alliance with the American Association of Personal Finance Companies. While most scholarship portrays experts as being dominated or co-opted by industry, our case provides a countervailing example. Far from controlling RSF experts, lenders became dependent on the foundation for legitimating their political lobbying and their business activities. We explain how the foundation built its expert reputation through a process of reputational entrepreneurship, and we trace how RSF experts deployed this reputation as a power resource in their negotiations with small loan lenders.
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Liu, Xinyu. "Analysis of Credit Score in China’s E-commerce Market." E3S Web of Conferences 218 (2020): 01028. http://dx.doi.org/10.1051/e3sconf/202021801028.
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Ecommerce has become the mainstream all around the world. In China, multiple platforms occupy the market of ecommerce. These platforms have different strategies and focus on unalike customers. Most of them use personal credit score as a measurement to reduce the risk of fraud transactions, especially in some second-hand goods platforms. In this paper, the author uses survey to analyze the potential relationship between credit score and frauds, from both the consumer and seller’s sides. Then the author discusses some possible improvements which could be made to adjust the current using credit system used in the online platforms.
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Athreya, Kartik, Xuan S. Tam, and Eric R. Young. "A Quantitative Theory of Information and Unsecured Credit." American Economic Journal: Macroeconomics 4, no. 3 (July 1, 2012): 153–83. http://dx.doi.org/10.1257/mac.4.3.153.
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Important changes have occurred in unsecured credit markets over the past three decades. Most prominently, there have been large increases in aggregate consumer debt, the personal bankruptcy rate, the size of bankruptcies, the dispersion of interest rates paid by borrowers, and the relative discount received by those with good credit ratings. We find that improvements in information available to lenders on household-level costs of bankruptcy can account for a significant fraction of what has been observed. The ex ante welfare gains from better information are positive but small. (JEL D14, D82, G21)
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Ramzaeva, E. P., and O. V. Kravchenko. "THE ANALYSIS OF THE SECTOR OF RETAIL LENDING OF RUSSIAN BANKS DURING THE PANDEMIC PERIOD OF 2020." Vektor nauki Tol'yattinskogo gosudarstvennogo universiteta. Seriya Ekonomika i upravlenie, no. 2 (2021): 41–46. http://dx.doi.org/10.18323/2221-5689-2021-2-41-46.
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Lending to the population is an essential part of the country’s economic system, its development in the global financial market. Due to the steady downward trend in economic growth and real incomes of the population, the spread of the coronavirus pandemic in the Russian Federation in 2020, the issue of fulfillment by the borrowers their obligations to banks became relevant. Many consumers of credit services were unable to fulfill their obligations in full and in due time, which led commercial banks to the most significant risk – credit one. The study considers the main aspects of the functioning of the Russian consumer lending market in the context of the lockdown of the global economy, analyzes the factors, which determined both the growth and contraction of the market under the pandemic influence. The study assessed the dynamic changes in key indicators determining the state of this economic sector in 2020. The authors analyzed the dynamics of granting retail credits and the dynamics of overdue debt. The paper considered the level of the debt burden of the population and the indicators of personal credit rating of borrowers – the main factors influencing the favorable decision on loan granting. Based on the study results, the authors conclude that the pandemic period did not cause severe damage to the retail lending sector. As the main trends of the current year, the study highlights toughening of the requirements on the part of commercial banks to borrowers, an increase in interest rates on credit products, and the improvement of payment discipline in the regions.
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Livshits, Igor, James MacGee, and Michèle Tertilt. "Accounting for the Rise in Consumer Bankruptcies." American Economic Journal: Macroeconomics 2, no. 2 (April 1, 2010): 165–93. http://dx.doi.org/10.1257/mac.2.2.165.
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Personal bankruptcies in the United States have increased dramatically, rising from 1.4 per thousand working age adults in 1970 to 8.5 in 2002. We use a heterogeneous agent life-cycle model with competitive lenders to evaluate several commonly offered explanations. We find that increased uncertainty (income shocks, expense uncertainty) cannot account quantitatively for the rise in bankruptcies. Instead, the rise in filings appears mainly to reflect changes in the credit market environment: a decrease in the transaction cost of lending and in the cost of bankruptcy. We also argue that the abolition of usury laws and other legal changes were unimportant. (JEL D14, E44, G21, G28)
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Woo, JongRoul, Joongha Ahn, Jongsu Lee, and Yoonmo Koo. "Media channels and consumer purchasing decisions." Industrial Management & Data Systems 115, no. 8 (September 14, 2015): 1510–28. http://dx.doi.org/10.1108/imds-02-2015-0036.
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Purpose – The purpose of this paper is to explore the factors determining which communication mediums influence a given consumer deciding to purchase a specific product. Design/methodology/approach – Using a consumer survey and a multivariate probit (MVP) model, the authors explore consumer information searches related to purchases in nine categories: milk, instant noodles, shampoo, mobile phones, televisions, cars, mobile communication services, credit card services, and life insurance. Findings – The media channels that motivate a given consumer to make a given purchase vary depending on both socio-demographic variables and product categories. Practical implications – As consumers can now obtain product information through different and multiple media channels according to their personal characteristics and the category of the product they seek to purchase, these findings will help companies develop media planning strategies that will effectively target specific market segments. Originality/value – Unlike previous studies, the authors consider which media channels actually affect a consumer’s product purchase decisions, and the authors do so across product categories and media types to provide practical implications for media planning. Furthermore, this is the first application of the MVP model in this context.
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Tong, Wei, and Li Ping Qin. "To Optimize a BP Network System." Applied Mechanics and Materials 50-51 (February 2011): 919–23. http://dx.doi.org/10.4028/www.scientific.net/amm.50-51.919.
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The neural network has been introduced into the studies of credit risk assessment. However, the ratio of the dataset for training and testing is difficult to determine, so the neural network is not robust enough to give the judgment. Therefore, using the 2000 instances of personal consumer credit data set for approval of credit applications of a provincial-level China Construction Bank, for the BP neural network model, the study focused on the ratio of the dataset for training and testing. The results show that, when the ratio of the dataset for training and testing is 800:1200, the neural network model 2 for credit risk assessment has better performance. And it can achieve the desired accuracy and computational efficiency, so the BP network system for credit risk assessment is optimized.
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Lee, Taejun (David), Bruce A. Huhmann, and TaiWoong Yun. "Readability of Korean-Language advertising disclosures moderates knowledge effects." International Journal of Bank Marketing 38, no. 7 (August 29, 2020): 1421–40. http://dx.doi.org/10.1108/ijbm-03-2020-0090.
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PurposeGovernment policy mandates information disclosure in financial communications to protect consumer welfare. Unfortunately, low readability can hamper information disclosures’ meaningful benefits to financial decision making. Thus, this experiment tests the product evaluation and decision satisfaction of Korean consumers with less or more subjective knowledge and with or without personal finance education.Design/methodology/approachA between-subjects experiment examined responses of a nationally representative sample of 400 Korean consumers toward a Korean-language credit card advertisement.FindingsFinancial knowledge improves financial product evaluation and decision satisfaction. More readable disclosures improved evaluation and satisfaction among less knowledgeable consumers. Less readable disclosures did not. Consumers without financial education exhibited lower evaluations and decision satisfaction regardless of readability. More knowledgeable consumers and those with financial education performed equally well regardless of disclosure readability.Practical implicationsFinancial service providers seeking more accurate evaluations and better decision satisfaction among their customers should use easier-to-read disclosures when targeting consumers with less prior financial knowledge.Social implicationsOne-size-fits-all financial communications are unlikely to achieve public policy or consumer well-being goals. Government-mandated information should be complemented by augmenting financial knowledge and providing personal finance training.Originality/valueAlthough almost a quarter of the world’s population lives in East Asia, this is the first examination of readability in disclosures written in East Asian characters rather than a Western alphabet. Previous readability research on Asian-originating financial disclosures has been conducted on English-language texts. This study extends knowledge of readability effects to growing East Asian markets.
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Nian, Tingting, Yuyuan (Anthony) Zhu, and Vijay Gurbaxani. "The Impact of the Sharing Economy on Household Bankruptcy." MIS Quarterly 45, no. 3 (September 1, 2021): 1213–48. http://dx.doi.org/10.25300/misq/2021/15514.
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Powered by digital technologies, many peer-to-peer platforms, or what is called the sharing economy, have emerged in the past decade. Although the impact of the sharing economy has received considerable attention over the past few years, extant research has not fully documented the impact of the sharing economy on consumers, workers, industry, or society as a whole. In this study, we exploit the geographical and temporal variation in Uber’s entry to examine its impact on the personal bankruptcy rate as well as on other consumer credit default rates. We empirically document the changes in personal bankruptcy filings after Uber’s entry, and show that personal bankruptcy filings under Chapter 7 experience a drop of 0.047 per 1,000 people after Uber enters a county, which translates to a 3.26% reduction in quarterly bankruptcy filings. Uber’s entry also leads to a reduction in Chapter 13 personal bankruptcy filings, but to a smaller degree (0.018 cases per 1,000 people per quarter). We check the validity of our estimates using business bankruptcy filings, which we find are uncorrelated with Uber’s entry.
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Moaisi, Lesolobe, and Sam Ngwenya. "Consumer indebtedness of public servants in South Africa: Evidence from the department of health in the North West province." Corporate Ownership and Control 11, no. 4 (2014): 258–76. http://dx.doi.org/10.22495/cocv11i4c2p4.
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The primary objective of this study was to determine the consumer debt level of public servants in the Department of Health in the North West Province, South Africa. The results of the study indicate that most public servants rely almost entirely on the public service remuneration to survive and for debt repayment. The results of the survey also indicate that 96% of public servants in the Department of Health in the North West Province are over-indebted. The respondents also perceived their income to be insufficient and thus resort to credit to maintain their required standard of living. The results also indicate that 63% of the respondents have a debt-income ratio above 20%. The reason for falling into debt is mostly due to lack of funds and insufficient income. The most common types of consumer debt found among the respondents included store cards (26%), followed by personal debt from banks (18%), while vehicle loan debt (37%) consumed the highest rand value of total debt among respondents. Personal loans from banks (21%) comprised the second highest debt value incurred by the respondents. It could be argued therefore that most public servants are over-indebted and could be trapped in a debt cycle if no additional income is provided or if they do not embark on some kind of personal financial management education
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Ramsay, Iain. "Towards an International Paradigm of Personal Insolvency Law? A Critical View." QUT Law Review 17, no. 1 (October 13, 2017): 15. http://dx.doi.org/10.5204/qutlr.v17i1.713.
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This article analyses three issues related to the global spread of personal insolvency laws. First, it outlines the emergence of an international paradigm on personal insolvency law and its central feature of a policy preference for partial repayment alternatives as the norm with residual immediate relief reserved for the deserving poor debtor. Second, it examines critically this paradigm in the light of existing empirical studies of the extent to which personal insolvency law achieves economic and social objectives associated with the fresh start such as financial inclusion. The mixed empirical findings on the success of personal insolvency law in achieving these objectives, particularly for individuals subject to instability of employment or poverty raises further questions about the role of personal insolvency law as a modestly progressive safety net for overindebtedness. The final section of the article considers therefore recent radical theories of consumer credit in contemporary capitalism which conceptualise credit as exploitative and personal insolvency law as a disciplinary and legitimating institution which individualises default and may neutralise collective responses to debt and its wider causes such as limited public support or provision. The article concludes by outlining how these radical insights might contribute to future socio-legal research on personal insolvency law.
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Gupta, Vipul, Sameer Khanna, and Iljoo Kim. "Personal Financial Aggregation and Social Media Mining." International Journal of Business Intelligence Research 5, no. 4 (October 2014): 14–25. http://dx.doi.org/10.4018/ijbir.2014100102.
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Consumers have been banking and trading online for several years now. More ambitious and tech savvy consumers have also been constructing an overview of their financial life by using Personal Finance software like Quicken and online tools such as Yodlee and Mint.com. Since late 1999, Personal Financial Aggregators (PFAs) have started offering internet based services to automate this process of account aggregation. This web account aggregation allows individuals to log onto one Web site and view all of their online accounts in one place. Online accounts that can be aggregated include financial sites (bank, credit card, brokerage, insurance, etc.) as well as lifestyle-based sites (travel awards, email, chat rooms, etc.). The idea behind Personal Financial Aggregation is to offer consumers their own personal portal from which they can see all their finances at a glance, balance and rebalance accounts, make investments, pay bills, etc. In addition to this Web data aggregation, consumers are relying on social media sites such as facebook, tweeter and other internet forums to get financial advice from each other and also to critique various financial products and services. As a result, many Financial Institutions (FIs) are using social media analysis and mining to shape their businesses. FIs include consumer banks, brokerages, insurance, wealth management firms, etc. This paper presents a framework for financial institutions that combines social media mining, web mining, online advice engines, and web aggregation. This framework can be utilized by FIs to analyze online buzz about their products/services and combine those insights with web aggregation and online advice to create different revenue streams and to offer personalized bundled products and services. The authors conducted interviews with various executives at the Global Financial institutions and insurance companies to test and validate this framework. A comprehensive review of top service providers and vendors that can enable and drive this framework is also discussed in this paper, followed by managerial implications, benefits and challenges.
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Et.al, Aqilah Nadiah MD SAHIQ. "Towards Achieving Long-Term Debt Sustainability: A Systematic Review of the Key Determinants of Personal Bankruptcy." Turkish Journal of Computer and Mathematics Education (TURCOMAT) 12, no. 3 (April 10, 2021): 1305–17. http://dx.doi.org/10.17762/turcomat.v12i3.900.
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Purpose: This systematic review aimed to assess previous research about financial and non-financial causes of personal bankruptcy among individual households. Additionally, the paper aimed to provide an insight into the key determinants of personal bankruptcy and to determine their relationship with individual characteristics. The fundamental causes of bankruptcy and its effects on financial status were also discussed. Through understanding the causes of bankruptcy, we hope to help financial institutions to minimise the number of personal bankruptcies.
Design/methodology/approach: A comprehensive systematic search was conducted to identify articles on determinants of personal bankruptcy. The selected articles were then analysed using the Preferred Reporting Items for Systematic Reviews and Meta-Analyses (PRISMA) protocol.
Findings: We identified several themes that emerged as the key determinants of personal bankruptcy filings. These determinants were demographic indicators, socioeconomic status indicators, debt indicators, financial indicators, social stigma indicators, behavioural indicators, and macroeconomic indicators.
Research implications: The key determinants of personal bankruptcy that were identified in this systematic review are renowned factors in the personal bankruptcy literature. Therefore, these determinants should be studied extensively to examine their effects in other studies and using a different type of datasets.
Practical implications: The findings of this study help the financial institutions to predict the likelihood of consumer default by developing an effective credit scoring model. Additionally, the development of an effective credit scoring model could serve as an early warning indicator to identify “high risk” client.
Originality/value: Bankruptcy is a long-term process that does not occur instantly. Therefore, a longitudinal and comprehensive approach is required to understand bankruptcy. Our findings contribute to the current literature by providing a better understanding of the causes of personal bankruptcy. We recommend developing an effective credit scoring model to predict the likelihood of personal bankruptcy.
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Contreras Pinochet, Luis Hernan, Guilherme Tongnole Diogo, Evandro Luiz Lopes, Eliane Herrero, and Ricardo Luiz Pereira Bueno. "Propensity of contracting loans services from FinTech’s in Brazil." International Journal of Bank Marketing 37, no. 5 (July 1, 2019): 1190–214. http://dx.doi.org/10.1108/ijbm-07-2018-0174.
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Purpose Given the large global investments made in FinTechs and the context of Brazilian credit (which has been suffering from the effects of the crisis in the last decade), the purpose of this paper is to study the propensity of consumption of credit services offered by FinTechs of loans. In order to discover the factors that influenced the propensity to apply for FinTech loans, a theoretical model was designed, which was tested by means of a survey given to individuals who might contract loans. Design/methodology/approach The final sample consisted of 507 individuals whose data were analyzed through structural equation modeling (SEM), with estimation of partial least squares. Findings From the results of the research, it was possible to draw a profile of the FinTechs of Brazilian loans and also to estimate the antecedents of the propensity to utilize this type of service. Research limitations/implications The model proposed in this work was developed to measure the propensity to consume in relation to the credit services offered by lending FinTechs. Practical implications The consumer should intensify the use of these channels to shape financial products and services to their needs, thereby democratizing access to credit, which is often restricted in quantity and quality by policies of institutions that dominate the Brazilian lending market. Originality/value Aspects such as trust, personal innovation, perceived utility, ease of use and social influence, as well as the constructs that precede them like privacy, stigma and transactional distance, explain 41.5 percent of the propensity to use services from lending FinTechs in Brazil.
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Lanzarini, Laura Cristina, Augusto Villa Monte, Aurelio F. Bariviera, and Patricia Jimbo Santana. "Simplifying credit scoring rules using LVQ + PSO." Kybernetes 46, no. 1 (January 9, 2017): 8–16. http://dx.doi.org/10.1108/k-06-2016-0158.
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Purpose One of the key elements in the banking industry relies on the appropriate selection of customers. To manage credit risk, banks dedicate special efforts to classify customers according to their risk. The usual decision-making process consists of gathering personal and financial information about the borrower. Processing this information can be time-consuming, and presents some difficulties because of the heterogeneous structure of data. Design/methodology/approach This paper presents an alternative method that is able to generate rules that work not only on numerical attributes but also on nominal ones. The key feature of this method, called learning vector quantization and particle swarm optimization (LVQ + PSO), is the finding of a reduced set of classifying rules. This is possible because of the combination of a competitive neural network with an optimization technique. Findings These rules constitute a predictive model for credit risk approval. The reduced quantity of rules makes this method useful for credit officers aiming to make decisions about granting a credit. It also could act as an orientation for borrower’s self evaluation about her/his creditworthiness. Research limitations/implications In spite of the fact that conducted tests showed no evidence of dependence between results and the initial size of the LVQ network, it is considered desirable to repeat the measurements using an LVQ network of minimum size and a version of variable population PSO to adequately explore the solution space in the future. Practical implications In the past decades, there has been an increase in consumer credit. Retail banking is a growing industry. Not only has there been a boom in credit card memberships, specially in emerging economies, but also an increase in small consumption credits. For example, it is very common in emerging economies that families buy home appliances on installments. In those countries, the association of a home appliance shop with a financial institution is usual, to provide customers with quick-decision credit line facilities. The existence of such a financial instrument aids to boost sales. This association generates conflict of interests. On one hand, the home appliance shop wants to sell products to all customers. Therefore, it is in its best interest to promote a generous credit policy. On the other hand, the financial institution wants to maximize the revenue from credits, leading to a strict surveillance of loan losses. Having a fair and transparent credit-granting policy favors a good business relationship between home appliances shops and financial institutions. One way of developing such a policy is to construct objective rules to decide to grant or deny a credit application. Social implications Better credit decision rules generate enhanced risk sharing. In addition, it improves transparency in credit acceptance decisions, giving less room to arbitrary decisions. Originality/value This study develops a new method that combines a competitive neural network and an optimization technique. It was applied to a real database of a financial institution in a developing country.
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Park, Sangwon, and Yiqun Huang. "Motivators and inhibitors in booking a hotel via smartphones." International Journal of Contemporary Hospitality Management 29, no. 1 (January 9, 2017): 161–78. http://dx.doi.org/10.1108/ijchm-03-2015-0103.
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Purpose The purpose of this research is to identify motivators (i.e. self-efficacy, perceived behavioural control and perceived benefits) and inhibitors (i.e. perceived cost and anxiety) that affect behavioural intentions to book hotel rooms using smartphones. Design/methodology/approach Utilising survey data collected from online consumers who have booked hotels in London, two stages of structural equation modelling were applied to estimate the proposed model. Findings The results of this research indicate that perceived behavioural control appears to be the core motivator for the use of smartphones to book a hotel with perceived benefits, whereas anxiety plays a negative role in leading to mobile booking behaviours. It is also identified that self-efficacy indirectly influences intentions to reserve hotel accommodation. Practical implications This study suggests that hospitality marketers should simplify the mobile purchasing process to enhance self-confidence in controlling the system during transactions, educate current and potential online consumers to become aware of the competitive benefits of using smartphones and create alliances with credit card companies to relieve anxiety when users are asked to provide personal or banking information. Originality/value In light of the substantial literature regarding the adoption of technology in terms of user experience (i.e. TAM), this study integrates two theoretical foundations of understanding consumer behaviours (i.e. a concept of consumer values and theory of planned behaviour) to assess motivators and inhibitors in behaviours related to booking hotel accommodation via smartphones.
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Jung, Hosung, and Hyun Hak Kim. "Default Probability by Employment Status in South Korea." Asian Economic Papers 19, no. 3 (October 2020): 62–84. http://dx.doi.org/10.1162/asep_a_00786.
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This paper analyzes the factors behind the loan defaults of borrowers by their employment status (whether they are self-employed) using the Korea Consumer Credit Panel data held by the Bank of Korea, and estimates the probability of default and the fragility of the financial sector. This is done using the concept of exposure at default for individuals. Using individual data on loans and delinquencies, we divide the spreads of personal loans into spreads determined by loan characteristics and spreads based on credit ratings to examine how these factors determine the probability of default among self-employed and non-self-employed borrowers. We find that the marginal effect of the spread based by the characteristic of loans and the borrowers’ credit ratings on the probability of default is greater to the self-employed borrowers, as compared to the non-self-employed borrowers. Especially, the effect of the spread by credit rating is stronger than the other. When we measure the vulnerability of financial institutions in terms of households’ probability of default, the institutions’ exposure to default of the self-employed affects to institutions’ vulnerability more than those of the non-self-employed. Therefore, more attention should be paid to the connectedness of financial institutions to household debt, and, in particular, the financial status of the self-employed.
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Deringer, Nancy C. "Parental Discussion about Personal Finances: Does it Make a Difference in the Amount of Debt Incurred?" Journal of Youth Development 8, no. 1 (March 1, 2013): 38–46. http://dx.doi.org/10.5195/jyd.2013.106.
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Higher education costs have increased substantially over the past two decades and, therefore, student loan debt has increased as well. Studies have shown that one earns more money over one’s lifetime if he/she has a four-year college degree. In fact, it is often substantially more depending upon one’s profession. However, for some individuals, the costs of funding higher education may be confusing and often times overwhelming. A study was completed at a university in the pacific northwest (n=778) which asked college students about their financial behaviors, credit card debt, student loan debt, discussions with parents, and in what topics or workshops they would like more information. Based on this data, faculty and graduate students from the school of family and consumer sciences and staff from the student financial aid office are creating workshops and curriculum to assist students in managing their debt and finances.
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Wren-Lewis, Simon. "Supply, Liquidity and Credit: a New Version of the Institute's Domestic Econometric Macromodel." National Institute Economic Review 126 (November 1988): 32–43. http://dx.doi.org/10.1177/002795018812600104.
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The forecast presented in chapter 1 was produced with a new version of the Institute's UK econometric model. Model 11 contains a number of new features. The largest number of innovations occur on the ‘supply side’ of the model, including new equations for manufacturing employment, investment, exports, imports prices and average earnings. Two equally important developments involve the interaction between company sector liquidity and decisions about real variables, and between the flow of consumer credit and personal consumption. There are new equations for the exchange rate, unemployment and a host of more minor variables. In all about half of the model's equations have been re-estimated, and 30 new variables added to the model. These changes constitute the largest and most significant development of the Institute's UK model since the introduction of rational expectations with Model 8. This note summarises these changes, and discusses their implications for various standard policy simulations. A full model listing is also published by the Institute.
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Rousseau, G. G., and D. JL Venter. "Financial insight and behaviour of household consumers in Port Elizabeth." Southern African Business Review 20, no. 1 (March 27, 2019): 236–58. http://dx.doi.org/10.25159/1998-8125/6052.
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Financial literacy is a crucial factor affecting individuals, households, financial institutions and the broader economy of South Africa (Oseifuah 2012: 23–24). Lack of financial literacy has been cited by various commentators (Brink 2011: 3, Schüssler 2014: 1–2; Dempsey 2015: 1–3) as the main reason for poor saving rates, increasing consumer debt and inadequate retirement planning among South Africans. The purpose of this study was to investigate the financial insight and behaviour of household consumers in Port Elizabeth. Economists have urged South Africans to start living within their means, improve their money management skills and ensure they eliminate debt, which can be viewed as the symptoms of mediocre financial insight and behaviour. Addressing these problems requires empirical evidence. A research model guided the investigation. A field survey (n = 560 consumers) was conducted in Port Elizabeth. The survey revealed six factors for financial behaviour and one for financial insight. The negative results for most factors confirmed the need for improved financial literacy of Port Elizabeth consumers. Significant relationships between demographical variables and financial behavioural factors were further observed for the sampled population. Educators and training facilitators should focus in their financial literacy programmes on financial planning, executing, vigilance, discipline, control and outsourcing personal financial services. Marketers and providers of credit should act responsibly when dealing with consumers with inadequate financial literacy.
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Sussman, Abigail B., and Rourke L. O'Brien. "Knowing When to Spend: Unintended Financial Consequences of Earmarking to Encourage Savings." Journal of Marketing Research 53, no. 5 (October 2016): 790–803. http://dx.doi.org/10.1509/jmr.14.0455.
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Maintaining savings is an important financial goal. Yet there are times when savings should be spent, such as when people face unavoidable costs, and spending their savings allows them to avoid high interest rate debt. Existing behavioral research has focused on consumer decisions between savings and discretionary spending and has proposed interventions to promote savings in these contexts. However, when spending is not discretionary, such interventions could risk exacerbating a pattern found in economic research in which people borrow high interest rate debt while maintaining savings that earn low levels of interest. To examine how mental accounting interacts with considerations of personal responsibility and guilt to contribute to this pattern, this article explores whether people spend their savings when they need money most: during emergencies. Six studies reveal that people's tendency to preserve savings by borrowing from a high interest rate credit option varies as a function of the savings’ intended use. Paradoxically, people are most likely to turn to high interest rate credit with the belief that doing so is the responsible option.
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Shneiderman, I. M., and A. V. Yarasheva. "Population Borrowing Behavior: Trends and Risks." Voprosy statistiki 26, no. 3 (March 30, 2019): 15–22. http://dx.doi.org/10.34023/2313-6383-2019-26-3-15-22.
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The article deals with current issues related to modern processes of lending to the population in Russia. The article aims to identify possible risks and consequences of over-lending to individuals based on the analysis of statistical data. Research objectives include analysing data dynamics of volume of the issued housing loans for the past 13 years, including mortgage loans; tracing the dynamics of household debt (total and for this type of lending) in rubles and foreign currency in macro-regions (Federal districts) of the Russian Federation; and describing the features and trends of car loans in our country. Results of the study revealed an uneven increase in the amount of debt on loans of the population living in different macro-regions of Russia. The authors concluded that the share of personal debt to credit institutions on mortgages «inside» of housing loan debt from 2006 to 2018 has more than tripled. In general, reasons for changes in the credit behaviour of Russians lie in lowered interest rates and the fear of their future growth, chances of refinancing previously taken loans, concerns about rising inflation, pent-up demand for housing and durable goods. A further increase in the growth of consumer loans and the volume of public debt on them may lead to the overheating of the credit market.
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Kurowski, Łukasz. "Household’s Overindebtedness during the COVID-19 Crisis: The Role of Debt and Financial Literacy." Risks 9, no. 4 (March 30, 2021): 62. http://dx.doi.org/10.3390/risks9040062.
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The COVID-19 pandemic has shown how important it is to prepare one’s own financial budget for the unexpected loss of income. In this dimension, the financial education of the society plays an invaluable role. It allows us to account for events that may adversely affect personal finances in our budget management decisions. Therefore, the aim of the article is to check whether households with a higher level of financial and debt literacy have better management skills from the perspective of a household’s budget, which in the face of a crisis reduces the risk of individuals not paying their liabilities. Thus, at the turn of June and July 2020, we conducted surveys among 1300 Polish citizens. Using the multinomial logistic regression, we show that people with a higher financial and debt literacy are less affected by overindebtedness. During the crisis, people who have a higher debt literacy are better prepared to manage credit liabilities; in this situation, financial literacy is less important. In addition, the type of credit experience turned out to be significant. Respondents who have experience with consumer loans (potentially high-margin products) are more likely to have debt repayment problems than those with mortgage loans experiences.
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Kiviat, Barbara. "The Moral Limits of Predictive Practices: The Case of Credit-Based Insurance Scores." American Sociological Review 84, no. 6 (November 7, 2019): 1134–58. http://dx.doi.org/10.1177/0003122419884917.
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Corporations gather massive amounts of personal data to predict how individuals will behave so that they can profitably price goods and allocate resources. This article investigates the moral foundations of such increasingly prevalent market practices. I leverage the case of credit scores in car insurance pricing—an early and controversial use of algorithmic prediction in the U.S. consumer economy—to unpack the premise that predictive data are fair to use and to understand the conditions under which people are likely to challenge that moral logic. Policymaker resistance to credit-based insurance scores reveals that contention arises when predictions depend on mathematical distinctions that do not align with broader understandings of good and bad behavior, and when theories about why predictions work point to the market holding people accountable for actions that are not really their fault. Via a de-commensuration process, policymakers realign the market with their own notions of moral deservingness. This article thus demonstrates the importance of causal understanding and moral categorization for people accepting markets as fair. As data and analytics permeate markets of all sorts, as well as other domains of social life, these findings have implications for how social scientists understand the novel forms of stratification that result.
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Behera, Rajat Kumar, Abhaya Kumar Sahoo, and Ajay Jena. "A Resourceful Approach in Security Testing to Protect Electronic Payment System Against Unforeseen Attack." International Journal of Open Source Software and Processes 8, no. 3 (July 2017): 24–48. http://dx.doi.org/10.4018/ijossp.2017070102.
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This article describes how electronic payments are financial transactions made over the internet for goods or services. In the digital era, the e-commerce industry has gone beyond the traditional in-store service due to the wide spread of internet-based shopping. Developed countries are greatly relying on e-commerce business and a sizable number of countries have shown concern in regard to the online payment cards such as credit cards, debit cards, e-cash, e-cheques, e-wallets and smart card security. The main downsides are concerns over privacy or a malicious attack and hence safeguard mechanisms are required to protect personal information from falling into the hands of intruders. Before commercializing electronic payment systems (EPS), security tests play a significant role in the software development life cycle to check whether the system is secure and it is safe to use. A resourceful approach covering security policies, secure coding, security attack prevention methodology, security testing tool, security testing metrics, security test case prioritization techniques and a model for effective project management methodology are presented in this article. Early detection and resolution of security weaknesses can be achieved with the authors' proposed approach and would certainly reduce the time, effort and cost of a project. The proposed approach is likely the best-fit implementation of the payment industry, covering channels like B2C (Business to Consumer), C2C (Consumer to Consumer), C2B (Consumer to Business), B2B (Business to Business), People to People (P2P), G2C (Government to Citizen) and C2G (Citizen to Government).
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Vela, Vince. "Doctoring up Cybersecurity Standards." Texas A&M Journal of Property Law 3, no. 2 (March 2016): 243–62. http://dx.doi.org/10.37419/jpl.v3.i2.7.
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In today’s technological world, it is common for corporations and individuals alike to enjoy and exploit the benefits of cloud computing. These advancements, however, come with a price as the modern technological age continues to grow. By its very nature, the normal course of business has changed drastically. From private entrepreneurial websites to conglomerates like Amazon, Inc., making purchases online has never been easier. Rather than traveling to your products, consumers today simply create an account with a certain business, enter personal credentials, provide a credit or debit card number for the transaction, and give an address for the shipment of their newly owned product. As a way to facilitate this course of business, it is normal for online venders to utilize their consumer’s information and store it for future use in the event that the consumer would like to purchase again. Due to the storing of valuable information onto the cloud, an increasing number of online security breaches via hacking from unauthorized individuals has occurred. This has led to multiple areas of contention between state laws and regulations, the businesses found therein, along with their valuable stored information and the use of the cloud itself. This Note aims to fill the gaps between the legal and the constantly changing technological world. Since valuable personal property is at stake when consumer information is stored in online databases, it is imperative that laws offering protection provide adequate safeguards to those most at risk. In filling these gaps, this Note first explains the use of cloud computing, including cloud variations and the essential components to these online databases. Second, this Note delves into an in-depth analysis of Federal Trade Commission v. Wyndham Worldwide Corporation, a recent FTC (Federal Trade Commission) case that has provided uncertainty in the cybersecurity world. Third, this Note identifies the gray areas from Wyndham that remain in question as well as provides a foundation of existing case law to shed light on the topic. Fourth, this Note proposes a change in the FTC’s current proceedings to provide a rule that identifies specific cybersecurity measures to obtain adequate protections in the event of cyber attacks.
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Barrell, Ray, and Dawn Holland. "Banking Crises and Economic Growth." National Institute Economic Review 202 (October 2007): 34–41. http://dx.doi.org/10.1177/0027950107086164.
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Over the summer of 2007 problems began to emerge in financial markets as a result of debt defaults, particularly on US housing lending to individuals with low credit ratings. The globalisation of financial markets has meant that such risks are shared across banks throughout the world and a number of European banks suffered major losses as a result of purchasing high yield high risk bundles of these assets. In this note we discuss the possibility of a systemic banking crisis as a result of debt defaults, putting this risk and its impact on the economy into recent historical context. We also look at the vulnerability of the personal and business sectors to increases in borrowing rates, and at the evidence for a risk related rise in borrowing rates. We then use our model, NiGEM, to investigate the impacts of a significant rise in the spread between lending and borrowing rates for both producers and consumers. Such an increase in spreads might arise when banks wish to rebuild their capital after a crisis or reflect significant capital rationing. In either case they represent the immediate impacts of a crisis in the banking sector. The spread between borrowing and lending rates for producers reflects a risk premium in the business sector, and was used in the September EFN report to the European Commission, whilst the spread between consumer lending and borrowing rates is in use for the first time on the model. The debt-to-income ratio has been rising in the personal sector in a number of countries, and especially in the UK, Ireland and Spain, as we can see from figure 1, and this might indicate where problems could arise.
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NIKOLAEVA, Tatiana Petrovna, Tatiana Aleksandrovna PANOVAz, and Anna Aleksandrovna VERSHININA. "Specifics of the Microfinance Market Development in Russia." Journal of Advanced Research in Law and Economics 10, no. 2 (March 31, 2020): 625. http://dx.doi.org/10.14505//jarle.v10.2(40).24.
Full textAbstract:
The specifics of the formation and development of the microfinance market in Russia as an alternative to bank lending are described in the article. The need of economic agents for financial services and the creation of an efficient financial credit system is justified. The content of relations arising in the process of microfinance and microlending is disclosed, their advantages and disadvantages are described, and the history of their occurrence is highlighted. The factors affecting the development of the microfinance market are identified, and the stages of its development in Russia are reviewed. The legal framework for the operation of microfinance organizations (microlenders) is covered, and the important role of the Bank of Russia in regulating their activities is revealed.
The role of credit in the economy and its ability to fasten the process of meeting the household and personal needs are defined. It is considered as a tool for the economy regulation.
The emergence of new forms and methods of lending is justified, and their influence on the socioeconomic development of society is reviewed.
It is noted that microfinance is one of the fastest growing sectors of the financial market in the face of declining bank lending volumes for consumer loans. The state of the microlending market is analyzed. The strengthening of supervision over the provision of microloans is substantiated, since they are in demand by many economic agents, including the population, private entrepreneurs, and legal entities.