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Interchange fees in card payments

Author

Listed:
  • Schmiedel, Heiko
  • Börestam, Ann

Abstract

The present paper explores issues surrounding multilateral interchange fees (MIFs) in payment card markets from various angles. The Eurosystem JEL Classification: C43, E31

Suggested Citation

  • Schmiedel, Heiko & Börestam, Ann, 2011. "Interchange fees in card payments," Occasional Paper Series 131, European Central Bank.
    • Handle: RePEc:ecb:ecbops:2011131
    Note: 332171
    as

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    File URL: https://www.ecb.europa.eu//pub/pdf/scpops/ecbocp131.pdf
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    References listed on IDEAS

    as
    1. Jean‐Charles Rochet & Jean Tirole, 2006. "Two‐sided markets: a progress report," RAND Journal of Economics, RAND Corporation, vol. 37(3), pages 645-667, September.
    2. Dorrucci, Ettore & McKay, Julie, 2011. "The international monetary system after the financial crisis," Occasional Paper Series 123, European Central Bank.
    3. Humphrey, David B & Kim, Moshe & Vale, Bent, 2001. "Realizing the Gains from Electronic Payments: Costs, Pricing, and Payment Choice," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 33(2), pages 216-234, May.
    4. Dorrucci, Ettore & McKay, Julie, 2011. "The international monetary system after the financial crisis," Occasional Paper Series 123, European Central Bank.
    5. Rochet Jean-Charles & Tirole Jean, 2006. "Externalities and Regulation in Card Payment Systems," Review of Network Economics, De Gruyter, vol. 5(1), pages 1-14, March.
    6. Julian Wright, 2004. "The Determinants of Optimal Interchange Fees in Payment Systems," Journal of Industrial Economics, Wiley Blackwell, vol. 52(1), pages 1-26, March.
    7. Verdier, Marianne, 2010. "Interchange fees and incentives to invest in payment card systems," International Journal of Industrial Organization, Elsevier, vol. 28(5), pages 539-554, September.
    8. David S. Evans & Richard Schmalensee, 2005. "The economics of interchange fees and their regulation : an overview," Proceedings – Payments System Research Conferences, Federal Reserve Bank of Kansas City, issue May, pages 73-120.
    9. repec:bla:jindec:v:50:y:2002:i:2:p:103-22 is not listed on IDEAS
    10. Zenger, Hans, 2011. "Perfect surcharging and the tourist test interchange fee," Journal of Banking & Finance, Elsevier, vol. 35(10), pages 2544-2546, October.
    11. Wright, Julian, 2003. "Optimal card payment systems," European Economic Review, Elsevier, vol. 47(4), pages 587-612, August.
    12. Rochet Jean-Charles & Tirole Jean, 2003. "An Economic Analysis of the Determination of Interchange Fees in Payment Card Systems," Review of Network Economics, De Gruyter, vol. 2(2), pages 1-11, June.
    13. Jean‐Charles Rochet & Jean Tirole, 2011. "Must‐Take Cards: Merchant Discounts And Avoided Costs," Journal of the European Economic Association, European Economic Association, vol. 9(3), pages 462-495, June.
    14. Rochet Jean-Charles, 2003. "The Theory of Interchange Fees: A Synthesis of Recent Contributions," Review of Network Economics, De Gruyter, vol. 2(2), pages 1-28, June.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Carlos Arango & Yassine Bouhdaoui & David Bounie & Martina Eschelbach & Lola Hernández, 2013. "Cash Management and Payment Choices: A Simulation Model with International Comparisons," Staff Working Papers 13-53, Bank of Canada.
    2. Hasan, Iftekhar & Martikainen, Emmi & Takalo, Tuomas, 2015. "Promoting efficient retail payments in Europe," Journal of Payments Strategy & Systems, Henry Stewart Publications, vol. 8(4), pages 395-406, January.
    3. Vilen Lipatov, 2015. "A Note on Partial Merchant Internalization and MIT Threshold," CESifo Working Paper Series 5684, CESifo.
    4. Schmiedel, Heiko & Bolt, Wilko & Foote, Elizabeth, 2011. "Consumer credit and payment cards," Working Paper Series 1387, European Central Bank.
    5. Juan, Iranzo & Pascual, Fernández & Gustavo, Matías & Manuel, Delgado, 2012. "The effects of the mandatory decrease of interchange fees in Spain," MPRA Paper 43097, University Library of Munich, Germany.
    6. Hasan, Iftekhar & Martikainen, Emmi & Takalo, Tuomas, 2014. "Promoting efficient retail payments in Europe," Research Discussion Papers 20/2014, Bank of Finland.
    7. Alen Veljan, 2020. "The influence of intra- and inter-system concentration on the pre-regulated setting of interchange fees within cooperative card payment networks," Journal of Banking Regulation, Palgrave Macmillan, vol. 21(2), pages 139-151, June.
    8. Korsgaard, Søren, 2014. "Paying for payments: free payments and optimal interchange fees," Working Paper Series 1682, European Central Bank.
    9. repec:zbw:bofrdp:2014_020 is not listed on IDEAS
    10. Bita Shabgard & Javier Asensio, 2023. "The price effects of reducing payment card interchange fees," SERIEs: Journal of the Spanish Economic Association, Springer;Spanish Economic Association, vol. 14(2), pages 189-221, June.
    11. Malte Krüger, 2019. "Multilaterale Interchange-Gebühren: Man sollte das Kind nicht mit dem Bade ausschütten," ROME Working Papers 201905, ROME Network.
    12. Nicole Jonker, 2013. "Social costs of POS payments in the Netherlands 2002-2012: Efficiency gains from increased debit card usage," DNB Occasional Studies 1102, Netherlands Central Bank, Research Department.

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    More about this item

    Keywords

    interchange fees; retail payment systems; trade credit and debit cards; two-sided markets;
    All these keywords.

    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation

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