Consumer behaviour in the credit card market: a banking case study

This paper analysed the demographic, socio-economic and banking-specific determinants
that influence the choice of credit cards. A multinomial logit model was run on a recent
portfolio of banking customers based in Italy. The model incorporates the type of credit
cards as the dependent variable and a set of explanatory variables. The empirical results
provided useful insight into the structural characteristics of the card payment system and
offered a microeconomics perspective to analyse consumers’ behaviour and preferences.
Overall, women, older people, residents in the centre of Italy and secondary card owners
are more likely to acquire a classic card. Gold cards are preferred by older customers,
whereas younger clients have a higher probability to choose a revolving card, which is also
preferred by the residents in the North-east. The analysis on the continuous variables
highlighted that Italy can be regarded as a ‘conservative’ market with room for credit card
upgrading and expansion into more sophisticated products