Journal of Financial Services Marketing

, Volume 22, Issue 2, pp 85–96 | Cite as

The orbit of consumer credit choices

  • Jane BrownEmail author
  • Anders Wäppling
  • Helen Woodruffe-Burton
  • Kate Black
Original Article


Resulting from instability in the UK financial climate in recent times, consumers have increasingly turned to alternative credit sources such as payday loans, logbook loans (car title loans) and pawning. Recognising this increasingly important trend in UK society, this study explores how UK consumers manage and select alternative credit sources, through a Consumer Culture Theory lens. Primary data were sourced through a multi-stage interview process with ten consumers of alternative credit providers. Findings were subjected to a rigorous six-stage thematic analysis, which enabled generation of a three-ring orbit model showing how the consumers migrated between categories of credit sources. Furthermore, it was found that other concepts could be traced on to the orbit model, such as access to other credit sources, time pressures, perceived risk and emotional state. It is expected that the findings from this study will benefit lenders, policy makers and regulatory bodies from greater insights into understanding of the emotional state of their customers and the particularly the pressures they may be experiencing when taking last resort credit sources.


Consumer behaviour Credit Debt Borrowing Payday loans Emotion 


  1. Alvarez, F., and U.J. Jermann. 2000. Efficiency, equilibrium, and asset pricing with risk of default. Econometrica 68 (4): 775–797.CrossRefGoogle Scholar
  2. Arnould, E.J., and C.J. Thompson. 2005. Consumer culture theory (CCT): Twenty years of research. Journal of Consumer Research 31 (4): 868–882.CrossRefGoogle Scholar
  3. Askegaard, S., and J.T. Linnet. 2011. Towards an epistemology of consumer culture theory: Phenomenology and the context of context. Marketing Theory 11 (4): 381–404.CrossRefGoogle Scholar
  4. Atalay, A.S., and M.G. Meloy. 2011. Retail therapy: A strategic effort to improve mood. Psychology & Marketing 28 (6): 638–660.CrossRefGoogle Scholar
  5. Balan, B.N. 2008. Multiple voices and methods: Listening to women who are in workplace transition. International Journal of Qualitative Methods 4 (4): 63–86.CrossRefGoogle Scholar
  6. Banks, J., C. O’Dea, and Z. Oldfield. 2010. Cognitive function, numeracy and retirement saving trajectories. The Economic Journal 120 (548): F381–F410.CrossRefGoogle Scholar
  7. Belk, R.W. 1988. Possessions and the extended self. Journal of Consumer Research 15 (2): 139–168.CrossRefGoogle Scholar
  8. Bertrand, M., and A. Morse. 2011. Information disclosure, cognitive biases, and payday borrowing. The Journal of Finance 66 (6): 1865–1893.CrossRefGoogle Scholar
  9. Bhutta, N. 2014. Payday loans and consumer financial health. Journal of Banking & Finance 47 (1): 230–242.CrossRefGoogle Scholar
  10. Braun, V., and V. Clarke. 2006. Using thematic analysis in psychology. Qualitative Research in Psychology 3 (2): 77–101. doi: 10.1191/1478088706qp063oa.CrossRefGoogle Scholar
  11. Brown, J., and H. Woodruffe-Burton. 2015. Exploring emotions and irrationality in attitudes towards consumer indebtedness: Individual perspectives of UK payday loan consumption. Journal of Financial Services Marketing 20 (2): 107–121.CrossRefGoogle Scholar
  12. Carson, D., A. Gilmore, C. Perry, and K. Gronhaug. 2001. Qualitative marketing research. London: Sage.CrossRefGoogle Scholar
  13. Citizens Advice. 2015. Payday loan problems halved since cap introduced. Citizens Advice Online.
  14. Citizens Advice. 2016. Payday loans after the cap: Are consumers getting a better deal? Citizens Advice Online.
  15. CFA. 2013. Facts & Research—Credit crunched: A commentary on the UK’s changing attitude towards borrowing and spending. Consumer Finance Association.
  16. Chatterjee, S., D. Corbae, M. Makajima, and J.-V. Ríos-Rull. 2007. A quantitative theory of unsecured consumer credit with risk of default. Econometrica 75 (6): 1525–1589.CrossRefGoogle Scholar
  17. Chrystal, K.A., and P. Mizen. 2005. A dynamic model of money, credit, and consumption: A joint model for the UK household sector. Journal of Money, Credit, and Banking 37 (1): 119–143.CrossRefGoogle Scholar
  18. CMA. 2015. Payday lending market investigation: Final Report. Competition & Markets Authority.
  19. Collinson, P. 2016. Car loans drive surge in UK consumer borrowing. The Guardian.
  20. Compeau, L.D., K.B. Monroe, D. Grewal, and K. Reynolds. 2016. Expressing and defining self and relationships through everyday shopping experiences. Journal of Business Research 69 (3): 1035–1042.CrossRefGoogle Scholar
  21. Corley, K.G., and D.A. Gioia. 2011. Building theory about theory building: What constitutes a theoretical contribution? Academy of Management Review 36 (1): 12–32.CrossRefGoogle Scholar
  22. Creswell, J.W. 2007. Qualitative inquiry and research design: Choosing among five traditions, 2nd ed. Thousand Oaks, CA: Sage.Google Scholar
  23. Deku, S.Y., A. Kara, and P. Molyneux. 2015. Access to consumer credit in the UK. The European Journal of Finance. doi: 10.1080/1351847X.2015.1019641.Google Scholar
  24. Denzin, N.K., and Y.S. Lincoln. 2003. Introduction: The discipline and practice of qualitative research. In The landscape of qualitative research, ed. N.K. Denzin, and Y.S. Lincoln, 1–45. London: Sage.Google Scholar
  25. DTI. 1999. Modern markets: Confident consumers. White Paper, Department of Trade and Industry.
  26. Duca, J.V., and A. Kumar. 2014. Financial literacy and mortgage equity withdrawals. Journal of Urban Economics 80: 62–75. doi: 10.1016/j.jue.2013.08.003.CrossRefGoogle Scholar
  27. Eastwood, D.B. 1975. Consumer credit and the theory of consumer behaviour. Journal of Behavioural Economics 4 (1): 79–105.CrossRefGoogle Scholar
  28. Eaton, J., and M. Gersovitz. 1981. Debt with potential repudiation: Theoretical and empirical analysis. Review of Economic Studies 48 (2): 289–309.CrossRefGoogle Scholar
  29. Eccles, S., H.R. Woodruffe-Burton and R. Elliott. 2002. Consumer (mis-) Management of Credit and Debt. In Proceedings of the academy of marketing conference, July, Nottingham, UK.Google Scholar
  30. Eccles, S. 2009. Patterns of addictive consumption. Paper presented at the British Association for Behavioural and Cognitive Psychotherapies, Exeter University, England.
  31. Edwards, R., and S. Weller. 2012. Shifting analytic ontology: Using I-poems in qualitative longitudinal research. Qualitative Research 12 (2): 202–217.CrossRefGoogle Scholar
  32. Ekici, A. 2006. Consuming, studying, and regulating genetically modified foods: A case for transformative consumer research. In NA—Advances in consumer research, vol. 33, ed. C. Pechmann, and L. Price, 613–622. Duluth, MN: Association for Consumer Research.Google Scholar
  33. FCA (2014) FCA proposes price cap for payday lenders. Financial Conduct Authority, 15 July, Accessed 1 Dec 2014.
  34. Fetchenhauer, D., O.H. Azar, G. Antonides, D. Dunning, R.H. Frank, S. Lea, and F. Ölander. 2012. Monozygotic twins or unrelated stepchildren? On the relationship between economic psychology and behavioral economics. Journal of Economic Psychology 33 (3): 695–699. doi: 10.1016/j.joep.2011.09.006.CrossRefGoogle Scholar
  35. Fossey, E., C. Harvey, F. McDermott, and L. Davidson. 2002. Understanding and evaluating qualitative research. Australian and New Zealand Journal of Psychiatry 36 (6): 717–732.CrossRefGoogle Scholar
  36. Gale, W.G., B.H. Harris, and R. Levine. 2012. Raising household saving: Does financial education work? Social Security Bulletin 72 (2): 39–48.Google Scholar
  37. Gallagher, S., and D. Zahavi. 2012. The phenomenological mind, 2nd ed. London: Routledge.Google Scholar
  38. Gallmeyer, A., and W.T. Roberts. 2009. Payday lenders and economically distressed communities: A spatial analysis of financial predation. The Social Science Journal 46 (3): 521–538.CrossRefGoogle Scholar
  39. Gasper, K., and L.M. Isbell. 2007. Feeling, searching, and preparing: How affective states alter information seeking. In Do emotions help or hurt decision-making?, ed. K.D. Vohs, R. Baumeister, and G. Loweinstein, 93–116. New York: Russell Sage Publications.Google Scholar
  40. Gathergood, J. 2012. Self-control, financial literacy and consumer over-indebtedness. Journal of Economic Psychology 33 (3): 590–602.CrossRefGoogle Scholar
  41. Harper, M., and P. Cole. 2012. Member checking: Can benefits be gained similar to group therapy? The Qualitative Report 17(2): 510–517.
  42. Heidhues, P., and B. Kőszegi. 2010. Exploiting Naïvete about self-control in the credit market. The American Economic Review 100 (5): 2279–2302.CrossRefGoogle Scholar
  43. Hirschleifer, J. 1958. On the theory of optimal investment decision. Journal of Political Economy 66 (4): 329–352.
  44. Hogg, M.K., and P.C.N. Mitchell. 1995. Constellations, configurations and consumption: Towards a conceptualization of intermediate patterns of joint consumption. European Advances in Consumer Research 2: 3–9.Google Scholar
  45. Hogg, M.K., and P.C.N. Mitchell. 1997. Constellations, configurations and consumption: Exploring patterns of consumer behaviour amongst UK shoppers. Advances in Consumer Research 24: 551–558.Google Scholar
  46. Huston, S.J. 2012. Financial literacy and the cost of borrowing. International Journal of Consumer Studies 36: 566–572. doi: 10.1111/j.1470-6431.2012.01122.x.CrossRefGoogle Scholar
  47. Jeacle, I., and E.J. Walsh. 2002. From moral evaluation to rationalization: Accounting and the shifting technologies of credit. Accounting, Organizations and Society 27: 737–761.CrossRefGoogle Scholar
  48. Joy, A., and E.P.H. Li. 2012. Studying consumption behaviour through multiple lenses: An overview of consumer culture theory. Journal of Business Anthropology 1 (1): 141–173.Google Scholar
  49. Juster, F.T., and R.P. Shay. 1964. Consumer sensitivity to finance rates: An empirical and analytical investigation. National Bureau of Economic Research, Inc. Available at
  50. Kamleitner, B., and E. Kirchler. 2007. Consumer credit use: A process model and literature review. Revue européenne de psychologie appliquée 57: 267–283.CrossRefGoogle Scholar
  51. Kehoe, T.J., and D.K. Levine. 1993. Debt constrained asset markets. Review of Economic Studies 60 (4): 865–888.CrossRefGoogle Scholar
  52. Kirchler, E. 1989. Kaufentscheidungen im privaten Haushalts. In Eine Sozialpsychologische Analyse des Familienalltages, Hogrefe: Göttingen.Google Scholar
  53. Kirchler, E., E. Hoelz, C. Rodler, and K. Meier. 2001. Conflict and decision making in close relationships: Love, money and daily routines. Hove: Psychology Press.Google Scholar
  54. Kishore, R. 2004. Theory of behavioural finance and its application to property market: a change in paradigm. Australian Property Journal 38 (2): 105–110.Google Scholar
  55. Kollatt, D.T., J.F. Engel, and R.D. Blackwell. 1970. Current problems in consumer behaviour research. Journal of Marketing Research 7: 327–332.CrossRefGoogle Scholar
  56. Lawrence, E.C., and G. Elliehausen. 2007. A comparative analysis of payday loan customers. Contemporary Economic Policy 26 (2): 299–316. doi: 10.1111/j.1465-7287.2007.00068.x.CrossRefGoogle Scholar
  57. Lea, S.E.G., P. Webley, and R.M. Levine. 1993. The economic psychology of debt. Journal of Economic Psychology 14: 85–119.CrossRefGoogle Scholar
  58. Lincoln, Y., and E. Guba. 1985. Naturalistic inquiry. Newbury Park, CA: Sage.Google Scholar
  59. Livshits, I., J. MacGee, and M. Tertilt. 2007. Consumer bankruptcy: A fresh start. American Economic Review 97 (1): 402–418.CrossRefGoogle Scholar
  60. Lusardi, A., and C. de Bassa Scheresberg. 2013. Financial literacy and high-cost borrowing in the United States. National Bureau of Economic Research (NBER) Working Paper 18969.Google Scholar
  61. Marron, D. 2014. “Informed, educated and more confident”: Financial capability and the problematization of personal finance consumption. Consumption Markets and Culture 17 (5): 491–511.CrossRefGoogle Scholar
  62. Morse, A. 2011. Payday lenders: Heroes or villains? Journal of Financial Economics 102 (1): 28–44.CrossRefGoogle Scholar
  63. O’Loughlin, D., and I. Szmigin. 2006. “I’ll always be in debt”: Irish and UK student behaviour in a credit led environment. Journal of Consumer Marketing 23 (6): 335–343. doi: 10.1108/07363760610701878.CrossRefGoogle Scholar
  64. Patton, M.Q. 2015. Qualitative research and evaluation methods, 4th ed. London: Sage.Google Scholar
  65. Riepe, M.W. 2013. Musings on behavioral finance. Journal of Financial Planning 26 (5): 34–35.Google Scholar
  66. Rook, D. 1987. The buying impulse. Journal of Consumer Research 14: 189–199.CrossRefGoogle Scholar
  67. Schicks, J. 2014. Over-indebtedness in microfinance—An empirical analysis of related factors on the borrower level. World Development 54: 301–324. doi: 10.1016/j.worlddev.2013.08.009.CrossRefGoogle Scholar
  68. Shankar, A., and J.A. Fitchett. 2002. Having, being and consumption. Journal of Marketing Management 18 (5–6): 501–516.CrossRefGoogle Scholar
  69. Sharifi, S., and G.M. Flores. 2013. Options for short-term credit in the United Kingdom. Social Science Research Network (March): 31. doi: 10.2139/ssrn.2259542.
  70. Shefrin, H. 2002. Beyond greed and fear: Understanding behavioural finance and the psychology of investing, 2nd ed. Oxford: Oxford University Press.CrossRefGoogle Scholar
  71. Shepherd, D.A., and R. Suddaby. 2016. Theory building: A review and integration. Journal of Management 43 (1): 59–86.CrossRefGoogle Scholar
  72. Sheth, J.N. 1974. A theory of family buying decisions. In Models of buyer behaviour: Conceptual, quantitative, and empirical, ed. J.N. Sheth, 17–33. New York: Harper & Row.Google Scholar
  73. Sporleder, T.L., and R.R. Wilson. 1974. Credit card purchasing and static consumer behavior theory. American Journal of Agricultural Economics, Agricultural and Applied Economics Association 56 (1): 129–134.CrossRefGoogle Scholar
  74. Tanaka, T., and T. Murooka. 2012. Self-control problems and consumption-saving decisions: Theory and empirical evidence. Japanese Economic Review 63: 23–37. doi: 10.1111/j.1468-5876.2011.00549.x.CrossRefGoogle Scholar
  75. The Money Charity. 2016. THE MONEY STATS—Unsecured private debt tops £190 billion. The Money Charity.
  76. Thompson, C., W. Locander, and H. Pollio. 1989. Putting consumer experience back into consumer research: The philosophy and method of existential phenomenology. Journal of Consumer Research 16: 133–146.CrossRefGoogle Scholar
  77. Wiginton, J.C. 1980. A note on the comparison of logit and discriminant models of consumer credit behaviour. Journal of Financial and Quantitative Analysis 15 (3): 757–770.CrossRefGoogle Scholar

Copyright information

© Macmillan Publishers Ltd 2017

Authors and Affiliations

  • Jane Brown
    • 1
    Email author
  • Anders Wäppling
    • 1
  • Helen Woodruffe-Burton
    • 2
  • Kate Black
    • 1
  1. 1.Newcastle Business SchoolNorthumbria UniversityNewcastle upon TyneEngland, UK
  2. 2.Business SchoolEdge Hill UniversityOrmskirk, LancashireEngland, UK

Personalised recommendations