Credit Card

About a study by a banker on using credit cards, examining how messages influence decisions. A bank issued credit cards to consumers, but many of them did not use the cards. Then the bank asked the inactive consumers why, and found they feared possible loss. There are two groups of inactive credit card users. One group receives messages saying they will be offered benefits if they continue to use the credit cards. The other group receives messages saying they will incur a penalty if they don't use the credit cards anymore. The potential loss of not using the cards is mentioned a few times. The conclusion is that customers are more motivated by a threat to lose something than by potential gains or persuasive messages. This phenomenon highlights that the fear of loss is a more effective motivator than the promise of being beneficial or receiving cash rewards."