Payment Systems and Interchange Fees
نویسندگان
چکیده
منابع مشابه
Payment card interchange fees and price discrimination∗
We consider the implications of platform price discrimination in the context of card platforms. Despite the platform’s ability to price discriminate, we show it will set fees for card usage that are too low, resulting in excessive usage of cards. We show this bias remains even if card fees (or rewards) can be conditioned on each type of retailer that the cardholder transact with. We use our mod...
متن کاملThe Determinants of Optimal Interchange Fees in Payment Systems
A fundamental aspect of any open payment system is the interchange fee that is paid from the merchant’s bank to the cardholder’s bank. Using a model in which there is partial participation by heterogeneous consumers and merchants, this paper characterizes the output maximizing, profit maximizing and welfare maximizing level of such an interchange fee. It examines how the optimal level of the fe...
متن کاملApproaches to Regulating Interchange Fees in Payment Systems
Significant attention worldwide has been paid to the regulation of credit card interchange fees. In part, this attention has followed concerns expressed about the level of these fees in Europe, the U.S. and Australia. The Reserve Bank of Australia recently conducted an extensive inquiry into the interchange fees associated with credit cards and has moved to regulate those fees. At the same time...
متن کاملThe Bilateral Negotiation of Interchange Fees in Payment Schemes
This paper considers the consequences of changing one feature of card payment schemes: the centralised setting of the default interchange fee, a fee banks pay each other for debit and credit card transactions. The level and setting of the interchange fee is currently under investigation in a number of jurisdictions. Policy makers and competition authorities have expressed concern over the appar...
متن کاملAn Economic Analysis of the Determination of Interchange Fees in Payment Card Systems
The paper investigates, in a non-technical fashion, the economic determinants of interchange fees in payment card systems and the potential need for their regulation. Among other things, it demonstrates that the proposal for a cost-based regulation of interchange fees relies on an erroneous, vertically organized, model of the payment card industry.
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ژورنال
عنوان ژورنال: The Journal of Industrial Economics
سال: 2003
ISSN: 0022-1821
DOI: 10.1111/1467-6451.00170