Future Payment Methods: How Will the Non-physical Transaction Feature of Future Payment Methods Affect Individuals' Spending Behavior Given Their Spending Type?

Abstract

In light of the ongoing digitalization and the increase in electronic payment methods, concerns have been raised that less transparent payments will have a negative impact on individuals’ spending behavior. The aim of our study is therefore to examine how the non-physical transaction feature of future payment methods will affect individuals’ spending behavior. We conducted 25 interviews with individuals from the age of 19 to 60 years old, as well as three additional interviews with experts within the payment field. We find that the non-physical transaction feature of future payment methods will lead to a higher increase in spending for spendthrifts than for tightwads. This is due to the higher willingness among tightwads to actively seek feedback on their spending behavior, as well as a higher experienced pain of paying.