Low-Income Consumers and Payment Choice

16 Pages Posted: 8 Mar 2020

See all articles by Oz Shy

Oz Shy

Federal Reserve Banks - Federal Reserve Bank of Atlanta

Date Written: February 11, 2020


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 US adult population, this short article 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, financial inclusion, unbanked consumers, random utility analysis

JEL Classification: D9, E42

Suggested Citation

Shy, Oz, Low-Income Consumers and Payment Choice (February 11, 2020). Available at SSRN: https://ssrn.com/abstract=3535199 or http://dx.doi.org/10.2139/ssrn.3535199

Oz Shy (Contact Author)

Federal Reserve Banks - Federal Reserve Bank of Atlanta ( email )

1000 Peachtree Street N.E.
Atlanta, GA 30309-4470
United States

HOME PAGE: http://https://www.frbatlanta.org/research/economists/shy-oz.aspx

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
PlumX Metrics