How does online payment affect consumer behavior?

With the development of e-commerce and Internet finance, online payment is becoming more and more popular among consumers, and at the same time it is also influencing people’s consumption behavior in a subtle way. The impact generated by online payment, consumers’ opinions on online payment, and the defects of online payment have become hot topics of concern and need to be explored in depth. In this paper, we briefly analyze the development status of online payment, the problems and the impact on consumers from a practical point of view, and put forward relevant suggestions. We hope that the research and analysis of this paper can help the development of online payment and Internet finance, and can also play a role in improving the consumer environment.

Online payment and its development status. Online payment, also known as online payment, is simply a paperless electronic settlement means in online transactions. Online payment plays an important role in e-commerce and is the central link of “capital flow”. The “Electronic Payment Guidelines” published by the People’s Bank of China stipulates that electronic payment instructions and paper payment certificates can be converted into each other, and both have the same effect. Online payment mainly includes third-party payment, cell phone payment and online banking payment.

According to the data of China Electronic Commerce Research Center, as of December 2012, the scale of users using online payment in China reached 221 million, and the usage rate increased to 39.1%. in 2013, a total of 23.674 billion online payment transactions occurred nationwide, amounting to RMB 1,060.78 trillion, up 23.06% and 28.89% respectively. in the third quarter of 2014, national banking institutions processed a total of 7.083 billion online payment services, amounting to RMB 365.59 trillion, up 16.61% and 31.05% respectively year-on-year. in the second quarter of 2015, the online payment services of banking institutions nationwide were 10.4 billion, amounting to RMB 464.3 trillion, up 55.6% and 44.6% respectively year-on-year. Non-bank payment institutions handled 20.66 billion online payment services, amounting to 11.1 trillion yuan, up 142.1% and 107.8% year-on-year, respectively.

However, in life, different groups of people hold different attitudes towards online payment. On the one hand, many people feel that online payment is fast and convenient, so the use of online payment far exceeds that of traditional payment. On the other hand, due to the Internet knowledge and technology required for online payment, the security loopholes of online payment and other problems, many consumers think that online payment is not reliable, making them trust traditional payment more.

Problems of online payment.

Security issues have become the biggest hidden problem affecting the development of online payment. The biggest problem of online payment is the existence of security loopholes, such as: consumers’ personal information is stolen for illegal elements to use, online payment transactions are often stolen account password, the security of funds can not be guaranteed, often making consumers feel apprehensive. If online payment wants to develop further, the first thing to solve is the security problem.

Online payment procedures are cumbersome. With the emergence of security loopholes in online payment, merchants have taken many security measures in the payment process for security reasons. Some websites also have restrictions on the browser version and trustworthiness when making payments, making the operation procedure cumbersome. In recent years, major banks have also adopted some security tools, but often both security and efficiency are not available. The Industrial and Commercial Bank of China has introduced U shields and cryptographs, but U shields must be connected to a computer to be used, and cannot be used independently. In addition, both the U shield and the cryptograph themselves require passwords to be set, and several passwords are required to make online payments, which inevitably makes consumers resentful. It can be seen that the online payment tools launched by banks have more or less cumbersome defects in the procedures.

Online payment limit is small. According to the data published on the official websites of major banks, ICBC’s ICBC ePayment customers have a daily single limit of 5,000 yuan and a cumulative daily limit of 5,000 yuan, which can be adjusted upward to 20,000 for a single transaction and 20,000 for a cumulative daily limit if there are special needs. Bank of China’s BOC Express Pay has a single limit of RMB 5,000 and a cumulative daily limit of RMB 5,000. China Construction Bank’s online payment using payment dynamic password has a single limit of 5,000 yuan and a cumulative daily limit of 5,000 yuan, and such limits are commonly found in online payment.

Online payment laws and regulations are not sound. Due to the special nature of online payment business, there are still many inadequacies in the current relevant laws and regulations for dealing with the emerging problems of online payment. In recent years, the civil and commercial judicial practice, the legal disputes about online payment have increased significantly, the jurisdiction of the case is controversial, difficult to obtain evidence, involving the crowd, the standard of adjudication is not the same, and when online payment disputes occur, a large majority of consumers do not know how to specifically defend their rights and interests from these laws and regulations, which seriously restricts the complete, orderly and healthy development of online payment.

The impact of online payment.

Online payment makes consumption more convenient. The most important impact of online payment on consumers is to make consumption more convenient. There are many people queuing for business at the bank branch, and the waiting time for business is too long and the bank can’t handle 24 hours at the end of the day. The emergence and application of online payment makes consumer’s consumption not limited by time and space, shopping and handling business without leaving home, thus online payment makes consumer’s consumption more convenient.

Online payment helps promote consumption. According to the monitoring data of China Electronic Commerce Research Center (100EC.CN), as of November 2015, the amount of online payment transactions of Everbright Bank exceeded 240 billion yuan, an increase of more than 140% year-on-year. Online payment will increase consumption, and the number of people traveling on holidays is rising, and consumers can order tickets for travel and tourist attractions in advance through online payment. The emergence of online payment has solved these inconveniences and promoted consumption.

Online payment saves costs. Online payment has the advantage of saving time, effort and trouble. Most young people say that they have to work overtime or even stay up all night to spend money in the field. They prefer to use online payment because it saves them the time cost of paying in the field. With the rising price of gasoline and the increasing number of private cars, the cost of transportation is also increasing, while online payment allows consumers to save on these transportation costs. The use of online payment allows consumers to save a lot of money in many aspects.

The payment method of online payment has changed the pattern of consumption. In 2014-2015, a total of 5 members led by me conducted a research on the project of “the impact of online payment on consumers”. 500 questionnaires were distributed and 402 valid questionnaires were returned. 402 consumers were interviewed, including post-70s, post-80s, post-90s and post-00s, accounting for 22.39%, 27.61%, 42.79% and 7.21% respectively of the total number of respondents. The proportion of the total number of consumers was 22.39%, 27.61%, 42.79% and 7.21% respectively. The survey data shows that respondents in the age group of post-70s and post-80s use more physical payment, and more respondents in the post-90s choose to use online payment, of which 77.78% of the post-70s choose to use physical payment, only 22.22% usually choose to use the payment method of online payment, while most of the post-90s prefer the payment method of online payment for consumption. In this study, we found that the emergence and use of online payment has caused many older consumers to shift from using physical payment as the only payment method to using traditional payment and online payment in parallel. Online has broken the pattern of traditional physical payment as the only payment method and has changed people’s consumption patterns and habits.

The vulnerability of online payment brings loss to consumers. The main reason why many consumers are reluctant to make online payments frequently is that they suffer losses due to security loopholes in online payments. When consumers are tricked into using online payment to transfer or remit money online, banks usually cannot recover the money in time, and consumers with related experiences are reluctant to use online payment again. In addition, the after-sales service of online payment is still a big defect. Some consumers usually do not get a satisfactory after-sales service solution when the items they get after making online payment are of bad quality or damaged, or when they are cheated to make online remittance and transfer.

The emergence and use of online payment has increased the irrational consumer behavior. In a narrow sense, consumer behavior refers only to the purchase behavior of consumers and the actual consumption of consumer materials. In a broader sense: the various actions taken by consumers to request and use consumer goods and the decision-making process that precedes and determines these actions, even a complex set of processes including the acquisition of consumer income. Consumers receive the influence of price when making consumption, and while online payment brings cost-saving benefits to consumers, it also increases to a certain extent the blindness and curiosity of consumers, thus increasing irrational consumption behavior.

Suggestions to promote the healthy development of online payment.

Improving the security of online payment and perfecting third-party payment platforms On May 18, 2015, the 9th Central China Investment and Trade Fair opened at the Wuhan International Expo Center, and the world’s first DNA anti-counterfeiting technology debuted at the fair, which can effectively solve the problems of commodity counterfeiting and theft of online banking funds. In recent years, face recognition and fingerprint verification technologies have been applied by cell phone operators and various commercial sectors. Major banks should actively introduce technical talents, encourage technological innovation, optimize transaction procedures, improve customer online payment systems and enhance the security of payment systems.

Establish a social integrity system and improve relevant laws and regulations. Standardize the rules of online payment market, solve the problem of lagging online payment laws and weak business supervision, there are no rules that do not make a circle, any industry regulation development cannot be done without the correct guidance of supporting laws and regulations and business supervision, with the development of e-commerce in recent years, some new forms of transactions in the field of online payment, for the construction of online payment business laws and regulations and business supervision also put forward new requirements and challenges. This also requires the support of relevant laws and regulations and standardized operation.

Consumers need to educate themselves, self-regulate and improve themselves. Consumers themselves should be brave enough to learn Internet knowledge, dare to try online payment, and improve their ability to pay online. They should exercise self-restraint and strive to form a reasonable consumption concept and rational consumption psychology, as well as rational consumption habits and a healthy consumption culture, so as to promote the healthy development of online payment.

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