Similarly, 53% of credit card users favored installments over a 10% discount, according to the ‘Consumer Credit Card Trends’ survey issued by Splitit, a patented payment technology provider. Among credit card users, high-income consumers (USD 100-150 thousand annual salary) most prefer interest-free installments over incentives, with approximately 60% of this group preferring installments.
Additionally, 40% of credit card users would increase the size of their purchase by at least 10% if offered interest-free installment payments. “Installments are a popular and successful payment method in six countries worldwide, but are relatively foreign to consumers in the US and Europe,” said Alon Feit, CEO of Splitit.
Lower income consumers (USD 0-25 thousand annual salary) are less likely to use credit cards (31%) whereas millennials (age 25-34) are the second biggest credit card user group (37%), below people aged 65+ (42%). Men are more likely to say yes when asked if they use a credit card (34%) than females (29.5%).
Store cards are the most popular installment-based payment method for credit card users currently on the market (50%), followed by PayPal Credit (42%). The primary reasons that consumers like installments is for budgeting purposes (54%), affordability (40%), building credit (4%) and zero interest (2%).
The survey was based on the responses of over 1,000 US credit card holders, evaluating consumer credit card trends and consumer sentiment towards paying in interest-free installments compared to traditional promotional incentives, such as discounts and free shipping.
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