CONSUMER’S PERCEPTION TOWARDS IMPLICATION ON USAGE OF
CREDIT CARD

INTRODUCTION

Credit card is one of an open account credit available to consumers. It allows its holder to buy goods and services based on the holder's promise to pay for these goods and services. The issuer of the card creates a revolving account and grants a line of credit to the consumer (or the user) from which the user can borrow money for payment to a merchant or as a cash advance to the user. According to Zafar U. Ahmed (2010), credit cards were first issued in the USA in the early twentieth century. In Malaysia, the first card was introduced in the mid-1970s. Since then, they have become a major system for exchange of transactions (or payments) that stimulates household and personal spending even in many developing countries of the world. At the early on period, credit cards were only issued to professionals or successful business persons by card issuing companies. However, with the passage of time, eligibility criteria for obtaining credit cards have been changed because credit cards are now easily obtained by individuals regardless of their income or other measures of financial well being. Referring to Zafar U. Ahmed (2010), Loke (2007) reported that in Malaysia, owning a credit card was considered a symbol of prestige. However, the low requirements offered by Bank Negara Malaysia for someone eligibility to obtain credit card has made the number of credit card usage has been increasingly. As a result, it was reported that, the number of cardholders reached to about three million by the turn of the last century. According to Malaysia Department of Solvency statistics from 2006 to 2012, they found that the number of bankruptcy cases increase from years to years. From the graph, it shows that in 2012 the numbers of bankruptcy cases slightly increase to 19,167 cases compared to 13, 238 in