TY - JOUR
T1 - Identity Theft and Consumer Payment Choice
T2 - Does Security Really Matter?
AU - Kahn, Charles M.
AU - Liñares-Zegarra, José M.
N1 - Funding Information:
Jose Li??ares thanks financial support from the Spanish Ministry of Science (EX2009-0908). We would like to thank the Editors, Haluk ??nal and David Musto, and an anonymous referee for useful comments and suggestions. We also thank participants in seminars at the Bank of Canada, the Federal Reserve Bank of Atlanta, the Computer Laboratory Security Group (University of Cambridge), the Essex Finance Centre (EFiC) and the participants of the 2014 Finest Summer Workshop for helpful comments and suggestions. We also thank participants in the RES Annual Meeting 2012 in London and the 1st Conference for Responsible Banking and Finance held at University of St Andrews.
Publisher Copyright:
© 2015, Springer Science+Business Media New York.
PY - 2016/8/1
Y1 - 2016/8/1
N2 - Security is a critical aspect of electronic payment systems. In recent years, the phenomenon of identity theft has gained widespread media coverage and has grown to be a major concern for payment providers and consumers alike. How identity theft has affected consumer’s payment choice is still an open research question. We use the 2009 Survey of Consumer Payment Choice (SCPC) to study the effect of identity theft incidents on adoption and usage patterns for nine different payment instruments in the U.S. Our results suggest that certain types of identity theft incidents affect positively the probability of adopting money orders, credit cards, stored value cards, bank account number payments and online banking bill payments. As for payment usage, we find that particular types of identity theft incidents have a positive and statistically significant effect on the use of cash, money orders and credit cards and a negative and statistically significant effect on the use of checks and online banking bill payments. These results are robust across different types of transaction, after controlling for various socio-demographic characteristics and perceptions toward payment methods.
AB - Security is a critical aspect of electronic payment systems. In recent years, the phenomenon of identity theft has gained widespread media coverage and has grown to be a major concern for payment providers and consumers alike. How identity theft has affected consumer’s payment choice is still an open research question. We use the 2009 Survey of Consumer Payment Choice (SCPC) to study the effect of identity theft incidents on adoption and usage patterns for nine different payment instruments in the U.S. Our results suggest that certain types of identity theft incidents affect positively the probability of adopting money orders, credit cards, stored value cards, bank account number payments and online banking bill payments. As for payment usage, we find that particular types of identity theft incidents have a positive and statistically significant effect on the use of cash, money orders and credit cards and a negative and statistically significant effect on the use of checks and online banking bill payments. These results are robust across different types of transaction, after controlling for various socio-demographic characteristics and perceptions toward payment methods.
KW - Heckman selection model
KW - Identity theft
KW - Payment choice
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U2 - 10.1007/s10693-015-0218-x
DO - 10.1007/s10693-015-0218-x
M3 - Article
AN - SCOPUS:84928128248
SN - 0920-8550
VL - 50
SP - 121
EP - 159
JO - Journal of Financial Services Research
JF - Journal of Financial Services Research
IS - 1
ER -