The cost of cash and debit cards in Austria

ABSTRACT This paper aims to close a gap in the literature on the cost of payment systems by;analyzing the cost of cash and debit cards in Austria. No prior analysis exists, as far as;the authors are aware. Using novel data from several sources, the unit costs for cash;and debit card payments in 2013 are estimated to be €0.40 and €0.39, respectively,;which are close to the most cost-efficient countries in Europe (the Netherlands and;Scandinavian countries). Although Austrian consumers have a much stronger preference;for cash than consumers in these countries, the Austrian payment industry;appears to have developed relatively cost-efficient institutional structures by relying;upon centralization and international outsourcing. However, cost efficiency could be;further increased by increasing the share of debit card payments or other cost-efficient;digital payment methods.