Abstract Six page paper exploring the recent and out of control trend of college students getting themselves deep into debt by getting easy creditcards at school.
Abstract This paper uses secondary data to analyze the creditcard industry along five constructs: (1) Competitive analysis: Porter's Five Forces and PEST analysis, (2) monopoly vs. perfect competition, (3) standardization vs. localization, (4) competition vs. collaboration and (5) revolutionary vs. evolutionary change. The author points out that the existing creditcard industry is a mature market, but it still has room to grow as more people become familiar with the allied financial services their credit and debit cards can provide. The paper relates that VISA enjoys the most powerful credit/debit card position in consumer cards especially in business creditcards, with it has extensive and integrated work in payments processing; however, the founders of First Data/Concord EFS were particularly aggressive business people. Many tables and charts.
Table of Contents
Introduction
In Brief
Background
Flies in the First Data Ointment
Objective
Methodology
Structure of the Dissertation
Literature Review
Competitive analysis
Porter's Five Forces
Porter's Five Forces Example
PEST Analysis
Economic Factors
Socio-Cultural Factors
Technological Factors
Literature Review
Monopoly vs. Perfect Competition
Standardization vs. Localization
National Initiatives
Competition vs. Collaboration
Revolutionary vs. Evolutionary Change
Opportunities
Overview of Credit and Debit Card Industries
Top Ten Card Issuers Compared
Bank Card Profitability
Differences between Credit and Debit Cards U.S. Payment Cards-in-Force (in millions)
Off-Line Debit History
Top 10 U.S. Issuers by Card Loans
Developed vs. Less Developed Nations' CreditCard Use
VISA Volume
2003 Top 10 Countries
Global Financial Cards in Circulation - 2003
Corporate /Commercial vs. Consumer Use
Analysis of VISA's Strategy
VISA's Strengths
VISA's Weaknesses
VISA's Opportunities
VISA's Threats
STP Strategy (Segmentation, Targeting and Positioning)
Conclusion
Conclusions and Recommendations
From the Paper "From the merchant's point of view, the merger was seen as one that would give them an alternative to VISA and MasterCard. Shortly after the merger, major STAR network contracts with high-profile banks such as Wells Fargo, Wachovia and BankOne were set to expire; this opened the field to some turmoil, in all likelihood, because VISA was already making a play to sign the same institutions for its processing and acceptance capabilities. FirstData/Concord was assumed to have the upper hand, however because analysts thought those two institutions, despite their disparate original sizes, understood contracts of that sort and banks themselves better then VISA. As it turns out, STAR did lose some of its bank contracts, reducing the value of the merger somewhat from the First Data standpoint."
Abstract The paper ascertains the attitudes of students relative to creditcards, examining their attitudes towards their perceived convenience, risk and the extra cost of potential transactions. The analysis includes both the students' and their families' income, the frequency of parents' fights over money and creditcards, specifically, and the number of creditcards carried. The paper discusses the conclusions from this research, that shows the marketing of creditcards for college students, both to their parents and to the students themselves, is extremely effective. The paper explains that creditcard companies are successfully imparting the messages of control, ego gratification and the rationalization of emergencies.
Outline:
Executive Summary
Research Issue
Methodology
Analysis of Results
Conclusions/Recommendations
Limitations
Appendices
From the Paper "Fifty students were given the printed questionnaire and assured complete anonymity and privacy, and also were left alone in classrooms after sessions were over to complete the survey. A $3 Starbucks Card was offered to the first ten students to complete the survey, so that motivation to quickly finish the research instrument would be assured. Graduate-level students were asked to complete the survey during an evening course break. "The sampling focused primarily on business students, with an even mix of women and men in the samples to rule out gender bias in the analysis of the results, a research design advocated by Hair, J.F., Anderson, R.E., Tatham, R.L., & Black, W.C. (1995) in their book."
Abstract While creditcards give the consumer many advantages, this paper takes a look at how creditcards have pushed the margin on high interest rates, at hidden fees and negative marketing strategies which have put society into debt.
Table of Contents
I. Introduction
A. Americans in creditcard debt.
II. Origin of creditcards A. Dates
B. Statistics
C. Relevant background
III. High Interest rates
A. Interest rates in recent years
B. Usury Laws
C. Who sets these laws?
IV. High Hidden Fees
A. The inflating Interest Rate Game
B. The Grace Period
C. Extra Fees
V. Negative Marketing Strategies
A. What to do first, if you have a complaint
B. Government agencies to contact
C. Can the company get penalties?
VI. Laws and Legislation regarding high interest rates, hidden fees and negative marketing strategies.
A. Truth in Lending Act
B.Governing finance charges
C.EFT Act
VII. CONCLUSION
From the Paper "Credit cards have become a symbol of the American way of life. Until recently Americans were enjoying a period of wealth and freedom never before experienced in history. They were in a mood to buy, and buy they did. Many turned to credit cards to make the purchases that they desired. Some commodities, such as rental cars cannot be obtained with out plunking down a credit card. While credit cards give the consumer many advantages, credit cards have pushed the margin on high interest rates, hidden fees and negative marketing strategies, putting society in to debt."
Tags: interest, consumer, dept, economy, loan, social
Abstract In the first part of this paper, the writer discusses the rise in creditcard use and looks at the reasons behind this increase. The writer then examines how the availability of easy credit caused a fundamental shift in American tastes. The writer also evaluates how these trends could affect a consumer's purchasing power, the credit industry, and even the national economy. The writer concludes that a combination of consumerism, economic need and the easy availability of credit have contributed to the revolving debt figures in the US. Further, the writer argues that as more people become knowledgeable about credit and are turning to debit cards and cash, creditors will have to devise new ways to encourage credit spending.
Outline:
Credit History
Credit Aftermath
Economic Effects
Works Cited
From the Paper "Previous research has suggested that only a small amount of credit-card holding households were responsible for the vast majority of credit card debt. Others have shown that as credit cards became more common forms of payment, average balances increased across the board. The fact that credit cards became more readily available in the early 1990s partly accounts for this phenomenon, and tends to support the latter conclusions. It is far more likely that all people are using credit cards more, rather than merely a fraction of American households."
"Bernthal et al attributes this increase in revolving debt to intense competition among lenders. There was therefore a strong incentive for lenders to extend loans to riskier households. In the 1980s, credit cards were seen as a status symbol, only acquired by those who had disposable income. By 1995, however, the average credit card holder had lower income and was more likely to be single. The average credit card holder was also more likely to rent rather than own their home, worked in a blue collar profession and often carried higher credit card balances."
Abstract The paper explores the numerous details of creditcard fraud by taking a look at the collection of data required to commit creditcard fraud, uses for this data, and how the criminal employs it to obtain credit fraudulently. The paper provides a real life example along with a list of ways to recognize the danger posed by this type of fraud.
Outline:
Collection of Data
Real Life Example
Conclusion
From the Paper "In a three year period, 2004 through 2006, approximately 1.27 million complaints of fraud were reported totaling over $2.4 billion; the most common form being credit card fraud, which accounted for approximately 30% of the reported incidents (Federal Trade Commission 7). Since the advent of the internet, criminals have found it increasingly easy to steal the identities of individuals, primarily through credit card fraud. However, even with significant advances in technology, many of the methods used to commit credit card fraud are decidedly simple. The way in which technology has really aided criminals is the widespread availability of personal information and a variety of techniques to collect an individual's data."
Abstract The paper shows that for Visa CreditCards, there was $487 million in fraudulent charges reported last year. The fraud rates on the Internet are .09%, compared to rates of .07% in the real world. The paper provides a background to the issue of creditcard fraud, its relation to Internet technology and possible solutions to overcome the problem.
From the Paper "Hoodwinks have gone high tech, using the Internet to deceive consumers in a variety of clever ways. One such way is through credit card fraud. As the use and availability of credit cards on-line increases, so does the occurrence of credit card fraud. The amount and frequency of fraud is increasing at a high rate, and many consumers fall victim to it. Credit card fraud has the ability to harm consumers and credit card companies. However, the ones suffering the most are not individuals in such a situation. Although individuals that never notice the extra charges end up paying for products they never bought, they are only responsible to pay for the first $50 if they notice the fraudulent charges and report them. Merchants tend to suffer the most, as they lose huge amounts of money in goods that were sold, yet never paid for. This has contributed to the closing of many companies, especially those on-line. Credit card companies report huge losses due to this type of fraud."
Abstract The paper relates that the creditcard is responsible for the deterioration of the family's ability to manage their finances in an acceptable manner. The author validates the hypothesis that as consumers continue to incorporate creditcard spending into their cultural practices, the economic impact will be the dissolution of one's economic buying power and stability. The paper researches whether additional financial education and training at the secondary level will help curb spending and the current acceptance of debt payment and debt equity as a norm of society.
Outline:
Abstract
Introduction
Literature Review
Method
Analysis
Conclusion
From the Paper "There is mounting evidence that the United States has become what many refer to as a "credit card nation" (Manning, 2000, p. 3), one dependent on debtor financing as an accepted and oft used form of payment among the wealthy and poor alike. The use of credit as a form of payment serves may purposes, including increasing the social status of independent users and providing users the opportunity to access services and commodities they may not otherwise have the opportunity to enjoy (Klein, 1999). Along with this opportunity however, also comes a financial obligation, one many consumers fail to recognize when they accept credit card financing as a primary vehicle for achievement and success (Klein, 1999)."
Abstract Over the past several decades, the American middle class has expanded by hundreds of thousands of households. Record numbers of families, headed by minorities, as well as female-headed households and single individuals have joined the middle class. The paper shows that with this growth and diversity throughout the class, the economy has witnessed record years in spending, especially through the use of credit. This increase in commitments of spending future income has resulted in a class-wide precarious financial position that has heightened their vulnerability to financial ruin. The paper examines the history of creditcards in the United States and shows how this form of payment is affecting the middle class in contemporary American society.
From the Paper "Now, many credit card companies actually avoid frugal types who use a credit card as a convenience and pay off balances every month. Instead, they statistically look for spenders who have an appetite for debt, are willing to make minimum monthly payments and tolerate high percentage rates and fees. They know that fees for late payments and fees for exceeding a credit limit increase profits. Sometimes an extra like credit protection, coupled with a late charge, is enough to put a customer over his credit limit, thereby giving companies another excuse to levy a charge (Gorham, On-line). The actual sub-prime market, which includes high loan-to-value ratios, includes mortgages, car loans and credit card debt, is "estimated at $200 billion dollars and growing by an estimated 50 percent a year" (Skelly 8)."
Examines concepts and practices relevant to the feasibility of marketing creditcard software to Internet businesses including brand name, loyalty, technology, promotion, attention, price and more.
3,150 words (approx. 12.6 pages), 3 sources, 1999, $ 111.95
Abstract Examines concepts and practices relevant to the feasibility of marketing creditcard software to Internet businesses.
From the Paper "EXECUTIVE SUMMARY
This paper is an analysis of the feasibility of selling a line of credit-card enabling software for companies wishing to do business on the Internet. As a part of this paper, 25 typical marketing definitions are restated to have more power and importance as part of a unified organization.
The concept of unification as opposed to pluralistic is also discussed, along with its benefits of adoption. The paper concludes with an analysis and description of market power and force analysis, using the concept of DADDIE.
The research in this paper reflects the first step of an ADDIE process -- that of analysis. The next step after this analysis would be to design and develop a plan that could be implemented and then evaluated."
Abstract The paper identifies the main concerns regarding college students using creditcards and highlights the implications of student debt on individual students, colleges and the economy. The paper considers potential solutions for colleges, but notes that there is only so much that colleges and the government can do, within the bounds of reason and free enterprise.
From the Paper "Credit card companies are increasingly targeting college students. A recent survey showed that 76% of students had cards marketed to them on campus, and a third of them said that free gifts were offered as an inducement to sign up . Card companies love the student market because students typically have few ties to financial institutions, and are thus a source of new customers. In particular, college students represent a demographic that is expected to secure good, white-collar employment once they graduate."
Abstract This paper discusses a recent press release from Sears Holdings Corporation regarding the new acceptance of Sears Credit in all Kmart locations. The paper discusses the Sears creditcard program as one of the most successful credit programs in retailing and how it will effect Kmart. The paper also analyzes Target Corporation's creditcard program in comparison for a more complete analysis of this recent announcement.
From the Paper "Sears Holdings--Sear and Kmart Sears Holdings Press Release Sears Holdings, the parent corporation of Sears and Kmart, recently announced it is further integrating the operations of both these major retail entities by making the Sears credit card available for use interchangeably at Kmart locations (Sears 2005). The Kmart-Sears merger which was first announced in November of 2004 and completed in the first quarter of 2005, shocked the retail industry both for its breadth and for the extremely diverse nature of the companies involved. Sears has long been a staid member of the department store club with such a long history and several rock solid brands, such as Craftsman and Kenmore that analysts first doubted could be successful."
Abstract This paper examines the popular American trend and phenomenon of buying on credit. It shows that the age of creditcard possession is decreasing while the debts increase. It focuses on the social sub group of students who buy on credit and how they represent a growing trend in America today. Three magazine articles are examined and the dangers of this social trend is discussed in great detail.
From the Paper "However, this familiar sight is one of the many reasons that college students are becoming more and more deeply ensnared in debt. These smiling individuals prey upon students when they are at their most vulnerable. Most of these students have just had to pay hundreds of dollars for a semester's worth of books. Perhaps they are still looking for a part time job to help out with their tuition bill. These students are the perfect candidates to trust an young individual whom does not seem so different from themselves, who promises them a favorable monthly rate in exchange for their signature. Even the added "free gift" makes signing for a credit card one is ill-equipped to pay more like something fun, like getting a birthday party goody bag as one did when one was a child, rather than engaging a serious economic decision that could impact one's future life. In fact, one could say, one is signing away one's economic life into a form of indentured servitude or slavery."
Abstract This paper looks at how commerce on the Internet is conducted almost entirely with creditcards or with Internet accounts established with creditcards and how, for many, particularly young people for whom cash has never been a necessity, it is easy to give in to the urge for instant gratification, even when there are no funds available to support this gratification. It shows how, in particular, college students may fall victim to this trap, since they may not see a creditcard purchase as spending with ?real money, they have little or no experience with creditcards or loans, and they are new to living independently from parents who have advised them not to buy things in the past. It examines the how, increasingly, student debt upon graduation is a crippling burden upon the student. It explores how the potential solution is to educate college students how to use their creditcards wisely and how to structure student loans and career plans with an eye toward the future, both of which can be accomplished by attending personal finance classes and by beginning with smaller creditcard lines.
From the Paper "The problem of student debt is twofold, and therefore, managing student debt should employ a double-barreled approach. Credit card/consumer debt is only one facet of the student debt issue, but students need to be able to distinguish between their necessary federally-funded student loan debt and their self-imposed credit card debt. In recent years, it has become common practice for credit card vendors to set up shop on college and university campuses, usually near the school bookstore (Fisher). Once established on campus, credit card companies attempt to lure students into signing up for credit cards by offering free incentives such as tee shirts or water bottles (Fisher). It is all too easy for students to succumb to the temptation for and the ease of obtaining credit cards when these credit lines are pushed so forcefully toward the often na?ve college student cohort."
Examines alternatives to cash, from a banking perspective. Discusses electronic commerce, ATMs, creditcards, consumer and security issues, credit unions, smart cards, plastic checks and microchips.
2,250 words (approx. 9 pages), 12 sources, 1999, $ 79.95
Abstract The development of cards which can access different monetary services electronically has been the major boost to electronic commerce. Many computer users today are accessing commercial enterprises on the Internet, but millions more have indulged in a different form of electronic commerce simply by using their ATM card, debit card, or creditcard in the course of daily business. The dissemination of such cards has been part of a long-term and evolving marketing strategy on the part of banks and other financial institutions to change the way people do business both with their banks and with retailers of various sorts.
From the Paper "NEW WAYS TO PAY
INTRODUCTION
The development of cards which can access different monetary services electronically has been the major boost to electronic commerce. Many computer users today are accessing commercial enterprises on the Internet, but millions more have indulged in a different form of electronic commerce simply by using their ATM card, debit card, or credit card in the course of daily business. The dissemination of such cards has been part of a long-term and evolving marketing strategy on the part of banks and other financial institutions to change the way people do business both with their banks and with retailers of various sorts. Some believe this could one day lead to a cashless society where all commerce is conducted through the use of plastic cards with ..."
