Identifying factors influencing credit card in a Colombo suburb area logistic regression approach

Abstract

Credit cards are electronic products that are now becoming more important and wellknown around

the world. The usage of credit cards is becoming highly connected to peoples’ day-to-day lives and credit cards have a greater impact on the rapidly changing lifestyles of busy people. However, penetration and usage of credit cards in Sri Lanka are still low when compared with other countries. Hence, identifying factors influencing the usage of credit cards would be of great importance for the banking industry, because through them, they can enact policies and take necessary measures to increase the number of Sri Lankans who use credit card. Though researchers have explored this study area in the recent past, In Sri Lanka, there is an empirical and knowledge gap. The purpose of this study is to figure out what factors influence or affect people's use of credit cards in Boralesgamuwa town area, which is a city in Colombo district, the western province of Sri Lanka. This is a cross-sectional study and was done in a non-contrived setting. The data was gathered using a questionnaire from 102 people in the Boralesgamuwa town area. Age, Gender, Education level, perceived cost, and Relatively advantages variables are highly affected by the use of credit cards in the Borelesgamuwa area. Thus, it was observed that customers' intention to use credit cards is highly dependent on those variables, and among those Perceived costs are discouraging the use of credit cards, relatively advantage encourages people to use credit cards. This result indicates the odds of using a credit card is 9.6 times higher for male than female. The odds of using a credit card is 10.2 times higher for those who have a diploma compared to up to A/L educated customers, The Odds of using a credit card is 18.4 times higher for who had a degree & above compared to up to A/L educated customers while other variables remain constant and change in one year in age changes the odds of use of a credit card increases by 1.5 units while other variable remain constant. The category of young age received a lot of responses. A young age group can be described using the odds value. Hence, the industries and policymakers should consider these when enacting policies, in order to improve the usage of credit cards among the people of the country.