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Managing perceived risk for credit card purchase through supplementary services

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Abstract

The present study aims to understand the significance of supplementary services as nonpersonal sources of information to consumers to handle perceived risk associated with the purchase of credit card services. The impact of supplementary services is particularly studied towards functional risk and psychological risk. The study is based on primary data collected by a survey with the help of a questionnaire administered through personal interviews. It is found that supplementary services can play a significant role in controlling functional and psychological perceived risk associated with credit card services. Marketers of credit cards can enhance the value of services to customers and can thus enhance purchase possibilities by reducing perceived risk through supplementary services that are controllable. Perceived risk in financial services marketing is an important factor from the consumers’ point of view for purchase decisions and is also an issue of significance to service marketers. It is an original attempt to examine the relationship between perceived risk and supplementary services.

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Authors and Affiliations

  1. Management Development Institute, Mehrauli Road, Sukhrali, Gurgaon, 122 001, India

    Anita Goyal

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  1. Anita Goyal
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Correspondence to Anita Goyal.

Appendix A

Appendix A

Set of Statements Used for Developing Required Constructs for the Study

I Statements for measuring association between supplementary services and functional risk

  1. 1

    Separate charges for some extra facilities are worth their value like petrol and railway ticket purchases.

  2. 2

    Additional benefits help in meeting all my financial needs.

  3. 3

    Additional benefits are appropriately designed to meet financial requirements.

  4. 4

    Additional facilities with a credit card meet my expectations.

  5. 5

    I would prefer to have added benefits with my credit card.

  6. 6

    *Additional facilities with a credit card increase its usage value.

  7. 7

    *Buying airline/railway tickets by using a credit card at special counters save time.

  8. 8

    *Through an add-on card other family members can also use the credit card.

  9. 9

    *I do not face the problem of inadequate cash because of ATM access, cash advance and cash withdrawal facilities with my credit card.

  10. 10

    *ATM access, cash advance and cash withdrawal and other facilities help to meet my financial requirements effectively.

* These statements were judged to be of high value by the experts and considered as major components of the construct towards association of functional risk and supplementary services.

II Statements for measuring association between supplementary services and psychological risk

  1. 1

    Protection against loss or damage from fire for items purchased through credit card provides me with a sense of security.

  2. 2

    People give recognition and attention, if purchases are made through credit card.

  3. 3

    I feel proud while making purchases through credit cards.

  4. 4

    It is easy to make a purchase decision on the basis of additional benefits.

  5. 5

    I feel delighted to have extra benefits with my credit card.

  6. 6

    **I feel good about my decision to have additional facilities with my credit card.

  7. 7

    **I feel myself in safe hands due to zero/limited lost card liability.

  8. 8

    **I prefer to have recognition and attention, if purchases are made through credit card.

  9. 9

    **Additional facilities like ATM access, cash withdrawal, etc with credit card provides me with a sense of security.

  10. 10

    **My family members are not dependent on me to use credit card due to add-on card availability.

** These statements were judged to be of high value by the experts and considered as major components of the construct towards association of psychological risk and supplementary services.

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Goyal, A. Managing perceived risk for credit card purchase through supplementary services. J Financ Serv Mark 12, 331–345 (2008). https://doi.org/10.1057/palgrave.fsm.4760086

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  • DOI: https://doi.org/10.1057/palgrave.fsm.4760086

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