Download This PaperLow-Income Consumers and Payment Choice
16 Pages Posted: 29 Apr 2020
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Low-Income Consumers and Payment Choice
Date Written: February, 2020
Abstract
Low-income consumers are not only constrained with spending, but also with the type and variety of payment methods available to them. Using a representative sample of the U.S. adult population, this paper analyzes the low possession (adoption) of credit and debit cards among low-income consumers who are also unbanked. Using a random utility model, I estimate the potential welfare gains associated with policy options suggested in the literature to provide subsidized and unsubsidized debit cards to this consumer population.
Keywords: consumer payment choice, household income, diversity, unbanked consumers, random utility analysis, unbanked, financial inclusion, consumer surveys, consumer behavior
JEL Classification: D90, E42
Suggested Citation: Suggested Citation