Interchange fees and two-sided markets: influencing the EU regulation on payment card fees

REF Impact Case Study 2021
Submitted to: UoA 17 - Business and Management Studies

Submitted title:ÌýInterchange fees and two-sided markets: influencing the EU regulation on payment card feesÌý

Summary

Research at Å·ÃÀÐÔ°®Æ¬ has significant regulatory change in interchange and merchant fees of payment cards in the European Union (EU) between 2013 and 2016. Acceptance of card payment platforms by both cardholders and merchants was essential for increasing the use of electronic payments in the EUÌýto integrate payment systemsÌýfor EU countries.ÌýBy demonstratingÌýthat lowering interchange and merchant discount fees would be beneficial to all parties andÌýbyÌýprovidingÌýevidence critical to EU decision-making concerned with regulatory changes,ÌýCarbo-Valverde’s research led to reducedÌýfees from June 2015. These changesÌýbenefittedÌýall merchants that use electronic payments,ÌýandÌýall cardholders and financial institutions across Europe, withÌýannual savings between 2015 and 2017 of EUR1,200,000,000 (03-2020) for EU merchants and EUR587,000,000 (03-2020) for EU consumers.The findings are also directly benefitting other, non-EU jurisdictions.

REF 2021 Case Study - Interchange payment card fees and two-sided markets

Researchers

  • Santiago Carbo-Valverde

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