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Competition and efficient usage of payment cards

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  • OECD
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    Abstract

    The OECD Competition Committee debated competition and efficient usage of payment cards in June 2006. In recent years, debit and credit cards have become increasingly common as retail payment mechanisms and have increasingly displaced checks and cash. The roundtable discussed potential market power and pricesetting abuses related to payment cards, reviewed the regulatory (or self-regulatory) mechanisms that sometimes govern the operation of card networks and considered methods for increasing the role of competitive forces among payment cards. A market failure exists because costs for different payment mechanisms are rarely reflected in consumer prices. Consideration should be given to permitting merchants to form payment ventures, as this would promote system competition between owners with different incentives, and to promoting entry by potential new technologies that would not involve existing payment networks. Many other policy options are discussed.

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    File URL: http://dx.doi.org/10.1787/clp-11-5kg9q0zk74vb
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    Bibliographic Info

    Article provided by OECD Publishing in its journal OECD Journal: Competition Law and Policy.

    Volume (Year): 11 (2009)
    Issue (Month): 3 ()
    Pages: 7-99

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    Handle: RePEc:oec:dafkaa:5kg9q0zk74vb

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