THE IMPACT OF ONLINE PAYMENT METHODS ON PERSONAL FINANCE MANAGEMENT

Abstract

This research studies on payment methods and their impact on personal financial management. It consists of studies that investigate the effects of contactless usage on personal finance management, as measured by spending, overdraft fees, cash usage, savings, and credit card debt. Contactless usage significantly increases spending frequency and amount, cash usage, and savings on the contactless enabled account, and that these effects persist at the contactless user level.
We discovered that mobile payments significantly increase spending frequency and amount, cash usage and savings, and significantly reduce the likelihood of receiving an overdraft fee on a mobile payment enabled account. Aside from the significant increase in spending, the majority of these effects also persist at the mobile payment user level.
This paper contributes to the payment economics literature by examining consumer payment choices and the dynamics of mobile and traditional payment methods. And also, the personal finance management like budgeting, saving, investing and debt management.