How do online payment applications change consumption?

Abstract

Combined with technology innovation, online payment develops very well and expends its offline market step by step, in order to achieve to further coverage of people’s lives. Going out without wallet is gradually becoming people’s normal habits. Online payment applications continue to show their characteristics of small amount but high frequency, and the convenient services. The coexistence of online payment and cash is still the major phenomenon. The conflicts between commercial banks and online payment indicate that the current online payment is still a dynamic market. These situations can change immediately due to variable factors which are related to consumers. This paper investigates several variables that can lead to the increase in consumption and also finds out differences and similarities between NFC and QR-Code payment, which are helpful to explain reasons why different countries have their different focuses and show the high popularity in China. Also, this research aims to discover several perceived risks and the relationship between them and consumers’ trusts or attitudes. This paper finds that both higher trust degree and perceived convenience of usage have significant influence on the increase in consumption. Economic, function and privacy risks are three important risks and there is an negative relationship between perceived risks and consumers’ trust. Consumers’ attitudes towards payment come from both those applications’ security guarantees and institutions’ and governments’ reactions. The growth of applications have made up for traditional financial services and it’s useful for clients to increase credits.