Information disclosure and credit card repayments: evidence from Malaysia
International Journal of Bank Marketing
ISSN: 0265-2323
Article publication date: 20 August 2021
Issue publication date: 28 October 2021
Abstract
Purpose
This study analyzes the role of information disclosure in influencing credit card repayments by focusing on three intervention methods for improving repayment decisions among credit cardholders.
Design/methodology/approach
This study uses the survey method to collect data. Four questionnaires are designed to identify which types of disclosure elicit better repayment decisions among credit cardholders. The participants were approached using the mall intercept method, and a total of 1,775 responses were obtained.
Findings
Estimations using means comparison tests show that not providing minimum payment information improves repayments. The expected benefits are not delivered by the provision of higher minimum payment information or additional information that highlights the negative effects of making the minimum repayment only. Further analysis using logit estimation reconfirms the benefit of not providing minimum payment information. However, when such information is given, low minimum payment information elicits better repayment decisions than high minimum payment information or additional information. Repayment worsens under the additional information condition compared to the high minimum payment condition.
Research limitations/implications
The findings of this study have a bearing on the decisions of policy makers, credit card issuers and consumers.
Originality/value
This paper clarifies the role of information in improving debt repayment decisions.
Keywords
Acknowledgements
The authors are grateful for the comments of the editor and anonymous reviewers, who significantly helped improve our manuscript. The usual disclaimer applies.
Funding: This research is funded by USM Research University Grant No. 1001/PJJAUH/8016028.
Citation
Sahul Hamid, F. and Loke, Y.J. (2021), "Information disclosure and credit card repayments: evidence from Malaysia", International Journal of Bank Marketing, Vol. 39 No. 7, pp. 1479-1497. https://doi.org/10.1108/IJBM-03-2021-0082
Publisher
:Emerald Publishing Limited
Copyright © 2021, Emerald Publishing Limited