PRESENTATION ON PLASTIC MONEY IN INDIA

SUBMITTED TO SUBMITTED BY
Asst.Prof Surbhi Sofat Kanwaljit Singh
MB18008
 INTRODUCTION TO PROJECT
Plastic money or polymer money, made out of
plastic , is a new and easier way of paying for goods
and services .Plastic money was Introduced in
1950s and is now an essential form of ready money
which reduces the risk of handing a huge amount
of cash .It includes debit cards ,ATMs, smart cards,
are used as substitutes for currency.
TYPES OF PLASTIC MONEY
 Credit card
A credit card is plastic money that is used to pay for
products and services at over 20 Million locations
around the world. All you need to do is produce the
   card and sign a charge slip to pay for your
  purchases. The institution which issues the card
  makes the payment to the outlet on your behalf; you
  will pay this 'loan' back to the institution at a later
date.
 
 
 
 Debit card
Debit cards are substitutes for cash or check
payments, much the same way that credit cards are.
However,•
banks only issue them to you if you hold
an account with them. When a debit card is used to
make a payment, the total amount charged is
instantly reduced from your bank balance
Differences between debit card and credit card
Debit card Credit card
It is a pay now product . It is a pay later product .

Money is automatically deducted from Money has to be paid afterwards.

the account.

Bank account for the cardholder is Bank account for cardholder is optional.
compulsory.

Owned money. Consumer loans.

Cost incurred by customer is zero. 2-3% per month interest is charged if

not paid in time. This might be vary
with the bank.
 Global card
Global cards allow you the flexibility
and convenience of using a credit card
rather than cash or travelers cheque
while traveling abroad for either
business or personal reasons.
 ATM card
The ATM cards will allow the customer to withdraw at
specified branches through debit to own savings or
current accounts by use of ATM’s .Here electronically
customer card is identified by code number and the
customers account is debited and is handed over to the
customer. An ATM card is useful to a card holder as it
helps him to withdraw cash from banks even when
they are closed. This can be done by inserting the card
in the ATM installed at various bank locations.
 Smart card
Smart card contains an electronic chip which is used
to store cash. This is most useful when you have to pay
for small purchases, for example bus fares and coffee.
No identification, signature or payment authorization
is required for using this card. The exact amount of
purchase is deducted from the smart card during
payment and is collected by smart card reading
machines.
NEED OF THE STUDY
The project is an integration of learning both in the area
of finance and marketing which focuses on most
important aspects related to plastic money in India.
The need of the study is to know the attitude of
consumers towards plastic money, know their
satisfaction level, to identify the factors why the plastic
money usage has increased and the annual demand of
plastic money. The study is done to know the procedure
for getting plastic money and various issues like
educating consumers, advertisement & promotion
and distribution strategies for effect.
SCOPE OF THE STUDY
 Use of plastic Money is growing at an unprecedented rate in
India. lesser number of installed Point-of-sale (PoS) terminals is
the major obstacle in the growth of debt card. Smart card has
many innovative features which may spurt the use of cards in
India. Smart card is more safe to use in electronic form than the
present form of cards."Credit card business is a volume game and
initially highly capital intensive."
 Plastic money is growing by leaps and bounds in India. Today,
many banks are offering cards. Though the foreign banks have a
dominant share, aggressive entry of the Indian banks like SBI,
ICICI and HDFC Bank may soon change the rules of the game.
Today, SBI-GE is the third largest issuer of credit cards.
 OBJECTIVES OF STUDY
To study the annual demand of plastic money.

To study the factors why the plastic money usage has
increased.

To find out the market leader among the various banks/
companies issuing credit and debit cards

To know the problems faced by respondents using

plastic money.
 RESEARCH METHODOLOGY
Research methodology is a way to systematically solve the research problem. It may be
understood as a science of studying how research is done systematically & scientifically.

 Research design :- Descriptive Research design

 Sample area :- Fatehgarh Sahib
 Sample size :- 100
 Sampling technique :- Convenience sampling
 Sources of Data :- Primary & Secondary
 Statistical tools used :- Questionnaire
DATA ANALYSIS AND
INTERPRETATION
1 .How many number of year usage of plastic
money?

Options Responses Percentage 60

0-1 year 25 50% 50

40

1-5 year 18 36% 30

20
Above 5 7 14% 10

0
Total 50 100% 0-1 Year 1-5 Year Above 5

INTERPRETATION:
 Table 4.1shows that 50% people used plastic money less than one year
because the awareness and usage of plastic money is increased now’s a days
and another reason is that it provides more facilities as compared to previous
year.36% people used from one year to between five year.14% people used
plastic money more than five years because they had aware earlier.
2.what are the charges taken by banks for providing
credit cards?
Options Responses Percentage
60
15 30%
50
Cheapest 40

Reasonable 28 56% 30

20
Excessive 7 14% 10

0
Total 50 100% Cheapest Reasonable Excessive

INTERPRETATION:
 Table 4.2 shows 30% people feel charges taken by banks for providing credit card
cheapest because it provided number of benefits like financial security, rewards,
insurance cover as opposed to cash or cheque.56% people said it is reasonable
charges which are charge by the banks. 14% said excessive charges are taken because
reason is that interest charge to them source of revenue to banks or credit card
companies.
3. What the Services provided by plastic money are
according to your expectations?

Options Responses Percentage

6% 40
Strongly 3 35 Strongly agree

 
agree 30
25
Agree

20 Neither agree-nor
Agree 8 16% 15
disagree
Disagree
10
Neither agree- 7 14% 5
Strongly
Disagree
nor disagree 0

Disagree 18 36%
Strongly 14 28%
disagree
Total
INTERPRETATION 50 100%
Table 4.3 shows 16% and 6% consumer are agree and strongly agree that plastic money
provide service according to their expectations because the reason is that more protection to
card holder , enhances their purchasing power and it is substituted for cash .14% consumer
are neither agree nor disagree. 36% and 28% consumer are disagree and strongly disagree
because plastic money also suffer from certain draw backs such as loss / stealing of credit
cards and many shops can except only credit cards of particular company.
 4. Which card that is more friendly to consumers?

Options Responses Percentage

.
Bank
Credit
12 24%

cards
Smart 4 8%
cards
ATM card 28 56%
Any other 6 12%
Total 50 100%

INTERPRETATION
 Table 4.4 shows 24% consumer think bank credit cards are more friendly because it empowers the consumer to make
payments of goods and services up to a preset limit at some interest rate. 8% consumer prefer smart card because these card
are built in safe guard against fraudulent operations.56% used ATM card because it allows to withdraw cash from own saving
and current account at specified branch by use of ATM’s.12% consumers using her credit card.
 5 Plastic money has more life time than paper money?

Options Responses Percentage

Strongly agree 12 24%
60
Strongly agree
Agree 28 56% 50

Neither agree- 16% 40 Agree

8
nor disagree 30
Neither agree-
20 nor disagree

Disagree 2 4% 10 Disagree
0
Strongly 0 0%
disagree
Total 50 100%

INTERPRETATION
 Table 4.5 shows 56% and 24% people are agree that plastic money has more life time than paper money because they are
made of plastic and it is not easily destroyed. 16% of people said neither they are not agree nor disagree. 4% people are
strongly disagree because they think plastic money magnetic strip can get worn-out due to excessive usages.
6.Where you get knowledge about your plastic money?
Options Responses Percentage
T.V Media 4 8%
T.V Media
40
Reference 17 34%
group Reference
30
group
Newspaper 2 4%
Newspaper
36% 20
Salesman 18
Billboard 1 2% Salesman
10
Any other 8 16%
0 Billboard
Total 50 100%
Any other
INTERPRETATION
 Table4.6 shows that8% consumer get the knowledge about plastic money TV Media .34%
for reference group, 4% from newspaper, 36% from salesman, 2% from bill board and 16%
from any other Mostly consumers are get knowledge about plastic money from salesperson
and from their reference group because they provide more information as compared to from
bill board, newspaper and TV media.
 FIGURE-4.8

7.what are the Benefit that considered most in plastic

money?
Options Responses %age
Withdraw cash from any branch 7 14%
Convenient method of payment 2 4%
Simple to operate 8 16
Protection from danger of pick 27 54%
pocketing a lot of cash
Any other 6 12%
Total 50 100%

INTERPRETATION
 Table 4.7shows 14% people like plastic money because
it provides the benefit of withdraw cash from any
branch, 4% people like that it is convenient method of
payment, 16% considered it is simple to operate. 12%
consider other benefit and 54% consumer consider
benefit that it provides protection from the danger of
pick pocketing a lot of cash.
 8.What are the Basic Defaults in the Plastic money?
Options Response Percentage
s
The price of credit is 14 28%
high
Additional fees to add 16 32%
the cost
Credit makes it easy to 8 16%
overspend
Other 12 24%

Total 50 100%

The price of INTERPRETATION

35
credit is high  Table 4.8shows 28% respondents said price of credit is
30
Additional fees high and 52% think that plastic money default is that it
25
add to the cost adds additional fees to add. 16% consumer said credit
20
card makes easy to overspend because it increase the
15 Credit makes it
easy to expenditure and purchasing power and they also think
10
overspend that after taking credit cards their needs are going to
5 Other
increased. 24% consumer said that there is any other
0
reason in the default of plastic money.
9 how many Satisfied from plastic money
service?
Options Responses Percentage
Very low 4 8% 50
Low 6 12% 40
Moderate 22 44% 30

High 16 32% 20

Very high 2 4% 10

Total 50 100% 0
Very low Low Moderate High Very high

INTERPRETATION
 Table 4.9 shows 12% and 8% people are satisfied low and very low because credits cards are
also lost or theft and many companies are not allow their cards to be used in areas where
they have a regional conflict.44% people are moderate statisfied.32% and4% are satisfied
high and very high because of plastic money provide number of the benefits such as need
not carry huge cash and it is simple
10.What are reason for choosing plastic money ?
Options Responses Percentage
Increasing purchasing 14 28% INTERPRETATION
 Table 4.10 shows 25% people
power
select plastic money for
Flexibility of payment 9 18% increased their purchasing
Insurance cover 4 8% power ,18% for flexibility of
Enjoy the facility of 5 10% payment,8% people for
insurance cover factor,10%
free credit
for the enjoy the facility of
Substituted for cash 18 36% free credit and 36% people
Total 50 100% used because of substituted
of cash. The majority of
people liked because of
substituted of cash which is
Increasing
simple and convenient to
40
purchasing
35 power
carry huge amount of cash
30 Flexibility of while going for shopping
25 payment
20
15 Insurance
cover
10
5 Enjoy the
0 facility of free
credit
 FINDINGS
• It clearly shows customers think that plastic money provide more security,
convenience and number of the benefits.

Customers are unsatisfied with plastic money services so they spread negative
word when they are asked are you satisfied with plastic money or service. Many of
the respondents give negative answer because credits cards are also lost .

The interest charged by credit card companies and banks is not very high.
Customers are aware of this fact that plastic money provides number of benefits
as compared to paper money.

Credit cards have led to increase in the expenditure of people because after taking
credit cards their needs are increased and it makes them east to overspend.

Mostly consumers have used ATM card as compared to other types of plastic
money because this card allows withdrawing cash from their own savings and
current account at specified branch by use of ATM’s.
 RECOMMENDATIONS
I made survey regarding the consumer attitude towards plastic money and done analysis on the
collected data. In my survey I want o give some suggestions regarding the research problem.

More awareness should be created by advertising campaign so that the consumers get
complete knowledge about the plastic money. The print media and electronic media should
also be used for providing information about plastic money.

Most of the respondents in the survey said that plastic money does not provide the quality of
service according to their expectations. So it is being recommended that it should increase
facilities in order to improve the quality of service.

Banks or credit card companies should try to reduce its charges in order to satisfy the
consumers.

Some of the respondents have credits cards but they can’t use it. So it is recommended that
more stress is required on promotional strategy for providing more convenience to make non
active users to become an active user of the plastic money

Banks should use an appropriate technology to deliver better customer service.

 
CONCLUSION
Plastic money is a term that has been used to a wide variety of payment
systems and technologies.1 Credit cards or electronic money transfer
through computer network or internet or through telecommunication
links are also termed as plastic money. 2 It is also known as digital cash.
These cards can be either multipurpose or single purpose cards. The
major classifications of plastic cards are the debit and the credit cards.
Debit cards are linked to the account of the card holder and they are
usually issued by the bank or the financial institution. When one uses
the debit card, the money immediately gets transferred from the
account. This card cannot pay more money than what is available in ones
account. Credit cards on the other hand are cards which enable us to
take a loan from the bank or the financial institution which issues the
card. Apart from these, there are charge cards, photo card, Global cards,
Co Branded cards, Affinity cards etc.
 KS
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