REVIEW OF RELATED LITERATURE

This research study cited books, articles, and laws, which are relevant to the
present investigation. It is composed of related literature, both local and foreign,
which contains facts and information on the research problem at hand. It also
provides explanations and logical connections between previous researchs and
present work.
FOREIGN LITERATURE
Credit cards provide benefits to consumers and merchants not provided by
other payment instruments as evidenced by their explosive growth in the number
and value of transactions over the last 20 years. The rapid growth in the creation
and dissemination of digital objects by authors, publishers, corporations,
governments, and even librarians, archivists, and museum curators, has
emphasized the speed and ease of short-term dissemination with little regard for
the long-term preservation of digital information. However, digital information is
fragile in ways that differ from traditional technologies, such as paper or microfilm.
It is more easily corrupted or altered without recognition. Digital storage media
have shorter life spans, and digital information requires access technologies that
are changing at an ever-increasing pace. Some types of information, such as
multimedia, are so closely linked to the software and hardware technologies that
they cannot be used outside these proprietary environments [ 1998]. Because of
the speed of technological advances, the time frame in which we must consider
archiving becomes much shorter. The time between manufacture and preservation
is shrinking.
Recently, credit card networks have come under scrutiny from regulators and
antitrust authorities around the world. The costs and benefits of credit cards to
network participants are discussed. Focusing on interrelated bilateral transactions,
several theoretical models have been constructed to study the implications of
several business practices of credit card networks.
The bank credit card market, containing 4,000 firms and lacking regulatory
barriers, casually appears to be a hospitable environment for the model of perfect
competition. Nevertheless, this article reports that credit card interest rates have
been exceptionally sticky relative to the cost of funds. Moreover, major credit card
issuers have persistently earned from three to five times the ordinary rate of
returnin banking during the periods 1983-88. The failure of the competitive model
appears to be partly attributable to consumers making credit card choices without
taking account of the very high probability that they will pay interest on their
outstanding balances. Copyright 1991 by American Economic Association.

Since the 1980s, Visa U.S.A. (Visa) and Master-Card International

(MasterCard), the bank-controlled credit card associations that together account for
approximately 70 percent of today's credit card market, have been able to control
the use of and access to their networks to the advantage of their bank members.
Recently, however, the credit card industry has been changing: some merchants are
now large enough to exert their own leverage, legal defeats have impeded the
ability of credit card associations to control the market, and some participants have
developed new arrangements and alliances that may be a prelude to further
changes in the industry. This article surveys recent developments in an industry that
is facing new competitive dynamics.