Revisiting Consumer Adoption of Plastic Money: Evidence from Regression and Correlation Analysis in Khairpur District

Abstract

The paper revises and revisits how consumers perceive the use of the plastic money (debit/credit cards) in Khairpur District, Sindh, Pakistan. The study is based on the reliability analysis, factor analysis, Pearson correlation and multiple regression to discuss the influence of the benefits of using cards, reasons not to use cards and problems faced when using cards on the consumer perceptions (and, consequently, actual usage of plastic money) depending on the results of the survey of 387 account holders. The Cronbach  alpha of the 25 item measure was 0.808. The results of regression analysis indicated that the three independent constructs accounted 86.8 percent of the variation of the use of plastic money (Adjusted R 2 = 0.868, F = 847.835, p =.001). Individual beta coefficients were: benefits (β = 0.413), reasons for not using (β = 0.663), and problems (β = 0.350). Cumulative regression also revealed that the composite perception variable was also explaining the usage of the plastic money 72.3% (Adjusted R 2 = 0.522, 1 = 0.723, p <.001). Each of the four hypotheses was tested. The findings indicate that policy makers and financial institutions should overcome the obstacle on consumer and promote the adoption of card infrastructure to hasten the adoption of digital payment in semi-urban Pakistani districts.

Keywords: plastic money, consumer perception, digital payments, regression analysis, Khairpur District, Pakistan.