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Article
Publication date: 12 July 2021

Constantino Stavros, Kate Westberg, Roslyn Russell and Marcus Banks

Service captivity is described as the experience of constrained choice whereby a consumer has no power and feels unable to exit a service relationship. This study aims to explore…

Abstract

Purpose

Service captivity is described as the experience of constrained choice whereby a consumer has no power and feels unable to exit a service relationship. This study aims to explore how positive service experiences can contribute to service captivity in the alternative financial services (AFS) sector for consumers experiencing financial vulnerability.

Design/methodology/approach

A total of 31 interviews were undertaken with Australian consumers of payday loans and/or consumer leases.

Findings

The authors reveal a typology of consumers based on their financial vulnerability and their experience with AFS providers. Then they present three themes relating to how the marketing practices of these providers create a positive service experience, and, in doing so, can contribute to service captivity for consumers experiencing financial vulnerability.

Research limitations/implications

The benefits derived from positive service experiences, including accessible solutions, self-esteem, and a sense of control over their financial situation, contribute to the service captivity of some consumers, rendering alternative avenues less attractive.

Practical implications

AFS providers must ensure a socially responsible approach to their marketing practices to minimize potentially harmful outcomes for consumers. However, a systems-level approach is needed to tackle the wider issue of financial precarity. Policymakers need to address the marketplace gaps, regulatory frameworks and social welfare policies that contribute to both vulnerability and captivity.

Originality/value

This research extends the understanding of service captivity by demonstrating how positive service experiences can perpetuate this situation. Further, specific solutions are proposed at each level of the service system to address service captivity in the AFS sector.

Details

Journal of Services Marketing, vol. 35 no. 6
Type: Research Article
ISSN: 0887-6045

Keywords

Article
Publication date: 5 January 2024

Kumuditha Hikkaduwa Epa Liyanage, Valentina Hartarska and Denis Nadolnyak

Financial inclusion is measured by the number of people who use the formal financial system and banks in particular. Limited access to formal banking services and the existence of…

Abstract

Purpose

Financial inclusion is measured by the number of people who use the formal financial system and banks in particular. Limited access to formal banking services and the existence of unbanked households is a main policy concern. The authors evaluate how the use of prepaid (reloadable) debit cards by unbanked households affects financial inclusion and specifically the potential for these households to participate in the formal financial system and open a bank account.

Design/methodology/approach

The authors apply matching models to analyze survey data from the Federal Deposit Insurance Corporation National Survey of the Unbanked and Underbanked Households from 2009 to 2019 and evaluate how prepaid cards use affects plans to open a bank account.

Findings

Unbanked households who use prepaid cards are 5% less likely to open a bank account compared to the matched nonusers of prepaid cards. In addition, prepaid card users are 12% more likely to use nonbanks to transfer money/transact online and 18% more likely to have obtained loans from alternative financial services providers compared to the matched unbanked nonusers of prepaid debit cards.

Originality/value

No previous work has estimated the causal impact of use of prepaid cards on financial inclusion.

Details

Journal of Financial Economic Policy, vol. 16 no. 1
Type: Research Article
ISSN: 1757-6385

Keywords

Article
Publication date: 12 February 2019

Xiaoyan Xu

The purpose of this paper is to study the “underbanked” – those who already possess bank accounts but are patrons of alternative financial services (AFS) providers at the same…

Abstract

Purpose

The purpose of this paper is to study the “underbanked” – those who already possess bank accounts but are patrons of alternative financial services (AFS) providers at the same time.

Design/methodology/approach

Linking the FDIC unbanked/underbanked surveys of nationally represented households with FDIC bank information and local MSA demographics, demographic and economic profiles of the underbanked households are examined, together with the determinants of their choice of nonbank financial services.

Findings

The author finds that bank fees are associated with the likelihood for households to obtain AFS, especially nonbank credit. Households’ attitudes and experience with banks are important in the choice of getting AFS. Furthermore, most underbanked households used AFS temporarily, partly reflecting rather informed and calculated financial decisions.

Research limitations/implications

The results from this paper provide implications for different types of AFS users. For example, the use of transactional AFS responds to the availability of online or mobile banking; meanwhile, it is also sensitive to branch closure. Users of nonbank credits are likely to be price savvy, and these products serve as valuable alternatives for short-term financing, especially during unfavorable economic situation.

Social implications

Better understanding of the underbanked could help banks tailor to existing clients’ needs, for instance, providing innovative short-term credit products for those with little or impaired credit history. The study also helps policy makers re-evaluate banking regulations since the Great Recession. As regulations squeezed bank profits in certain areas and forced banks to consolidate, come alongside higher bank fees, potential branch closure and loss of service, which ultimately forced banked individuals to the less regulated alternative providers.

Originality/value

The analysis utilizes a comprehensive set of variables, from household social-economic characteristics to local banking industry characteristics, together with households’ subjective opinions of their banking institutions. The focus on the underbanked brings attention to this underserved population and discusses areas where banks can improve. The study contributes to the understanding of AFS users, draws implications for regulation toward banking and shadow banking.

Details

Journal of Financial Economic Policy, vol. 11 no. 3
Type: Research Article
ISSN: 1757-6385

Keywords

Article
Publication date: 1 June 1999

Joost M.E. Pennings, Martin G.M. Wetzels and Matthew T.G. Meulenberg

The financial services industry is one of the fastest growing service industries. The financial services industry includes financial derivatives markets such as options and…

2609

Abstract

The financial services industry is one of the fastest growing service industries. The financial services industry includes financial derivatives markets such as options and futures markets. In order to ensure survival, firms providing financial services show a rapid product innovation. However, for financial services the risk of failure is considerable. Argues that a synthesis between the financial approach and the marketing approach towards financial services provides a conceptual framework for analysing the possible success or failure of futures contracts. The synthesis is illustrated by an empirical study of a new futures contract that might possibly be introduced.

Details

European Journal of Marketing, vol. 33 no. 5/6
Type: Research Article
ISSN: 0309-0566

Keywords

Article
Publication date: 1 February 2001

David Thomas

The paper summarises the role of alternative dispute resolution, by ombudsmen and others, in the development of the European single financial market. It describes three particular…

Abstract

The paper summarises the role of alternative dispute resolution, by ombudsmen and others, in the development of the European single financial market. It describes three particular initiatives sponsored by the European Commission — a financial services alternative dispute resolution (ADR) network, a general consumer ADR network and work on the relationship between ADR schemes and the Internet — and indicates where the Financial Ombudsman Service fits into these.

Details

Journal of Financial Regulation and Compliance, vol. 9 no. 2
Type: Research Article
ISSN: 1358-1988

Article
Publication date: 5 April 2013

George Mawuli Akpandjar, Peter Quartey and Joshua Abor

The purpose of this paper is to investigate household financial choice and the determinants of financial services in rural and urban households in Ghana.

1319

Abstract

Purpose

The purpose of this paper is to investigate household financial choice and the determinants of financial services in rural and urban households in Ghana.

Design/methodology/approach

Data from the Ghana Living Standard Survey 5 (GLSS 5) are used to estimate the participation of a household in a particular financial sector and what determines this choice.

Findings

The results from Tobit and conditional logit models account for households' demographic characteristics and their financial decisions. The Tobit estimates show that household size, age, sex, marital status, occupation, income, remittances and shocks determine households' participation in the financial markets. Conditional logit model results suggest that locational characteristics are important in obtaining financial services from particular sectors of the financial market. The results also suggest that when the alternatives of financial services are available, rural households are more likely than urban households to obtain their financial services from the informal financial sector.

Originality/value

This current study contributes to the existing literature from the Ghanaian perspective.

Details

International Journal of Social Economics, vol. 40 no. 5
Type: Research Article
ISSN: 0306-8293

Keywords

Article
Publication date: 1 January 1986

Carla B. Furlong and J.R. Brent Ritchie

Financial services have entered a new era in which distinctions between different services have become blurred. Consumers are now faced with numerous combinations of products and…

Abstract

Financial services have entered a new era in which distinctions between different services have become blurred. Consumers are now faced with numerous combinations of products and services. Many professionals feel that there is a need for financial counselling services. This study uses a sample of 139 corporate employees in Canada. It reveals that “convenience” in the choice of a supplier of financial services is not as important as the supplier's expertise. The most important benefit of FCS is family protection. The benefit of a counsellor is the opportunity to gain advice on the advantages and disadvantages of available investment options. Over 50 per cent of the sample indicate they would use an FCS, yet many are unfamiliar with the concept of overall financial planning and the use of counsellors. Most would prefer their counsellor to be from the accounting profession, in the role of a “contractor” where one expert is employed but relies on the expertise and products of a network of other counsellors. Although the population used does not accurately reflect the general population, it does represent an important share of the market, and as such it does cast some doubt on certain assumptions which have often been accepted as self‐evident.

Details

International Journal of Bank Marketing, vol. 4 no. 1
Type: Research Article
ISSN: 0265-2323

Keywords

Article
Publication date: 1 January 1990

F. Christian Zinkhan and George M. Zinkhan

The application on conjoint analysis to the taskof customising financial services is discussed.Conjoint analysis allows for the generation of theutility levels associated with…

Abstract

The application on conjoint analysis to the task of customising financial services is discussed. Conjoint analysis allows for the generation of the utility levels associated with financial service design alternatives. By evaluating service‐provider and customer utility levels simultaneously, an efficient frontier of financial service designs can be identified. This process can greatly simplify the financial service design selection decision, since it eliminates inferior alternatives from consideration. A hypothetical example, the selection of commercial line of credit features for a potential corporate customer, is demonstrated.

Details

International Journal of Bank Marketing, vol. 8 no. 1
Type: Research Article
ISSN: 0265-2323

Keywords

Open Access
Article
Publication date: 5 July 2022

Aijaz A. Shaikh, Hawazen Alamoudi, Majed Alharthi and Richard Glavee-Geo

Using the theory, construct, method, moderator (TCMM) format, this framework-based review critically analyses the mobile financial services (MFSs) field through a detailed…

9295

Abstract

Purpose

Using the theory, construct, method, moderator (TCMM) format, this framework-based review critically analyses the mobile financial services (MFSs) field through a detailed synthesis and analysis of a sample of mainstream empirical research published in various scientific journals within the period 2009–2020.

Design/methodology/approach

The authors followed a three-step structured approach suggested by Webster and Watson (2002) to search for the literature to synthesise the global perspectives on MFSs and their associated applications and systems. The literature research resulted in the identification of 115 most relevant articles.

Findings

The authors identified three major categories or domains within the MFSs comprising the entire spectrum of digital financial services. To facilitate the literature analysis, TCMM is developed and proposed as an organising framework. Moreover, the authors also developed and presented the comprehensive framework of MFS domains and explicitly identified 14 different research themes for future research in MFSs.

Originality/value

Prior attempts to synthesise and analyse mainstream academic research in MFSs have been scant and limited to a specific MFS domain: mobile banking or mobile payment. The authors synthesised a more extensive body of knowledge and provided a global perspective on the MFS field. Unlike the past literature reviews which followed traditional frameworks such as antecedents, decisions and outcome (ADO); TCCM; and 6 W Framework (who, when, where, how, what and why), the authors developed and proposed TCMM as organising framework.

Details

International Journal of Bank Marketing, vol. 41 no. 1
Type: Research Article
ISSN: 0265-2323

Keywords

Article
Publication date: 11 November 2019

Beatriz Fernández-Olit, José María Martín Martín and Eva Porras González

The purpose of this paper is to provide a systematic literature review of the research published on financial inclusion (FI) and financial exclusion (FE) in developed countries…

2677

Abstract

Purpose

The purpose of this paper is to provide a systematic literature review of the research published on financial inclusion (FI) and financial exclusion (FE) in developed countries using key terms and strict inclusion and exclusion criteria.

Design/methodology/approach

In total, 52 papers were deemed to be relevant to the analysis. These works were critiqued using a framework that addressed geographical contexts, topics, methodologies and theoretical frameworks.

Findings

This review highlights the uneven level of development of the academic debate between North America, the UK and continental Europe, and identifies the different theoretical frameworks that construe the body of literature in each region. In addition, the findings show the scant offer of work on the impact that the digital economy has on FE, as well as the reduced number of studies which have focused on certain vulnerable groups and the access to some financial services.

Social implications

The studies reviewed have not analyzed the specific needs of vulnerable groups while considering the different contexts and pathways to exclusion. The evaluation of solutions and strategies to achieve inclusion is one of the least addressed aspects in the literature.

Originality/value

The paper synthesizes the main contributions of the top literature on the redefinition of FI/FE in developed countries, the role of fringe services and new determinants of exclusion. The proliferation of studies regarding FI in low- and middle-income countries has generated a great amount of meta-analysis and systematized reviews of asymmetric results. However, no systematized literature review on the broad scope of FI/FE in developed countries has been published in the last decade. This work sheds light over poorly analyzed areas of research that refer to notable social problems.

Details

International Journal of Bank Marketing, vol. 38 no. 3
Type: Research Article
ISSN: 0265-2323

Keywords

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