Enhancing Economic Sustainability with Credit Payment Services in a Dual-Channel Supply Chain

Xinqian Huang, Liang Xu, Jun Liu and Ying Huang
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Xinqian Huang: Research Institute of China Telecom Corporation Limited, Beijing 100081, China
Liang Xu: Research Institute of China Telecom Corporation Limited, Beijing 100081, China
Jun Liu: Research Institute of China Telecom Corporation Limited, Beijing 100081, China
Ying Huang: Research Institute of China Telecom Corporation Limited, Beijing 100081, China

Sustainability, 2022, vol. 14, issue 14, 1-14

Abstract: In the digital age, data-driven credit payment services play a significant role in constructing sustainable supply chains, which can stimulate consumption by reducing consumers’ cash pressure, thereby promoting a sustainable economic development. Our study investigates a dual-channel supply chain consisting of a supplier and a retailer, wherein the supplier ex-ante decides whether to implement the credit payment policy in the consumer market, and then the retailer determines whether to provide credit payment services in the reselling channel. We uncover that the supplier’s preference toward credit payment policy is not unidirectional. Specifically, the supplier establishes credit payment policy in the consumer market unless the discount of cash opportunity cost is lower than the price discount of credit payment services. Moreover, we find that, under credit payment policy of the supplier, the retailer opts to provide credit payment services when the discount of cash opportunity cost is higher than the price discount of credit payment services. Interestingly, our results demonstrate that, compared with non-credit payment policy, credit payment policy may restrict the development of economics sustainability, which undermines the whole supply chain.

Keywords: economic sustainability; credit payment services; sustainable supply chain; game theory (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
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