ISSUES REGARDING PLASTIC MONEY IN PAKISTAN

Abstract

Financial restructuring and privatization of banks in Pakistan have increased
competition in banking sector. Thus a number of innovative products, for making
payment, are offered by Banks. Such products are alternatives to cash or the standard
'money', and known as Plastic Money. Plastic money is considered much more
convenient and secure to carry around and use worldwide as compared to cash.
However, in Pakistan most of the customers are reluctant to adopt and use Plastic
Money Products that is why Plastic Money Industry is still undeveloped in Pakistan. The
purpose of this research is to find out the issues faced by Pakistani Customers regarding
Plastic Money. This research is based on the qualitative findings of data collected from a
sample of customers both users and non-users of Plastic Money. The sample was
composed of customers having different demographic characteristics such as Age,
Gender, Income level, Occupation, Education level and Area of Residence (rural,
urban). Data analysis revealed that a large number of Pakistani customers have certain
misperceptions about Plastic Money. Most of the people are not even aware of Plastic
Money and the ways of using them. Lack of education, poor banking services, electricity
failure, limited options, over spending and insecurity of transactions are the reasons
having negative influences on market of Plastic Money in Pakistan. This study provides
an understanding and insight of these issues and its impacts on consumer's behavior
about Plastic Money. This study provides some recommendations to attract Pakistani
customers towards Plastic Money.