Determinants of Consumers' Preference for Consumer Durable Loan Products

Abstract

Consumer durable goods are products that provide utility over an extended period and include household appliances and high-value items such as washing machines, refrigerators, televisions, audio-video systems, motor vehicles, and other long-lasting consumer products. Owing to their relatively high cost, many consumers are unable to purchase these products with their regular income, particularly amid rising living expenses and increasing household financial commitments. As a result, consumer durable loan products offered by banks and financial institutions have become an important source of financing, enabling consumers to acquire durable goods without placing an immediate financial burden on their finances. Against this backdrop, the present study was undertaken to identify the factors influencing consumers' preference for consumer durable loan products in Chennai City. The study was based on primary data collected from 200 respondents using a structured questionnaire. A total of seventeen variables representing different aspects of consumer durable loan products were analyzed using exploratory factor analysis, which identified five predominant factors influencing consumers' borrowing decisions, namely Product Features, Professionalism, Brand Image, Word-of-Mouth, and Convenience. Among these, product features and professionalism emerged as the most influential determinants of consumers' preference for consumer durable loan products. Further, the results of the chi-square analysis revealed a statistically significant association between the volume of consumer durable loans availed by the respondents and their income level, indicating that income plays a vital role in determining the extent of consumer durable loan utilization.

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