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Do newspaper articles on card fraud affect debit card usage?

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  • Kosse, Anneke

Abstract

This paper investigates the impact of newspaper publications about debit card skimming fraud on debit card usage in the Netherlands using daily information from January 1st 2005 to December 31st 2008. Time-series analyses are employed to assess the daily fluctuations in aggregate debit card usage. The results show that newspaper articles that somehow make mention of the phenomenon of skimming fraud significantly affect the number of debit card payments. The direction of the effect depends on the type of skimming fraud addressed. Newspaper articles on fraud at points-of-sale (POS) and ticket machines depress the number of debit card payments. News on ATM fraud, by contrast, has a positive effect on debit card payments. This indicates that the temporarily created fear for using the debit card at the ATM is not automatically translated into fear for using the debit card at the POS. Instead, ATMs and POS terminals are perceived as substitutes. Although significant, all media effects found are relatively small in comparison with other factors such as calendar and holiday effects and daily rainfall. Moreover, the effects only last for one day, with consumers immediately reverting back to their regular payment behaviour. This corresponds to earlier results found in other research fields and suggests that consumers JEL Classification: C22, C23, D12, E21

Suggested Citation

  • Kosse, Anneke, 2011. "Do newspaper articles on card fraud affect debit card usage?," Working Paper Series 1389, European Central Bank.
    • Handle: RePEc:ecb:ecbwps:20111389
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    Cited by:

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    2. Vyacheslav Mikhed & Michael Vogan, 2017. "How Data Breaches Affect Consumer Credit," Working Papers 17-6, Federal Reserve Bank of Philadelphia.
    3. Cologgi, Massimiliano, 2023. "The impact of regulation on retail payments security: Evidence from Italian supervisory data," Finance Research Letters, Elsevier, vol. 54(C).
    4. Ardizzi, Guerino, 2012. "The Impact of the Microchip on the Card Frauds," MPRA Paper 41435, University Library of Munich, Germany.
    5. Nicole Jonker & Mirjam Plooij & Johan Verburg, 2017. "Did a Public Campaign Influence Debit Card Usage? Evidence from the Netherlands," Journal of Financial Services Research, Springer;Western Finance Association, vol. 52(1), pages 89-121, October.
    6. Mikhed, Vyacheslav & Vogan, Michael, 2018. "How data breaches affect consumer credit," Journal of Banking & Finance, Elsevier, vol. 88(C), pages 192-207.
    7. Anneke Kosse, 2021. "An Empirical Analysis of Bill Payment Choices," Staff Working Papers 21-23, Bank of Canada.
    8. Anneke Kosse, 2013. "The Safety of Cash and Debit Cards: A Study on the Perception and Behavior of Dutch Consumers," International Journal of Central Banking, International Journal of Central Banking, vol. 9(4), pages 77-98, December.
    9. Guerino Ardizzi & Simone Emiliozzi & Juri Marcucci & Libero Monteforte, 2019. "News and consumer card payments," Temi di discussione (Economic working papers) 1233, Bank of Italy, Economic Research and International Relations Area.
    10. Rasmi Ranjan Behera & Rajas Saroy & Sarat Dhal, 2023. "Digital Payments in Urban Odisha: Insights from a Primary Survey," Review of Development and Change, , vol. 28(2), pages 141-165, December.
    11. Bruno Karoubi & Régis Chenavaz & Corina Paraschiv, 2016. "Consumers’ perceived risk and hold and use of payment instruments," Applied Economics, Taylor & Francis Journals, vol. 48(14), pages 1317-1329, March.
    12. Jonker, Nicole & van der Cruijsen, Carin & Bijlsma, Michiel & Bolt, Wilko, 2022. "Pandemic payment patterns," Journal of Banking & Finance, Elsevier, vol. 143(C).
    13. Nathan Blascak & Julia S. Cheney & Robert M. Hunt & Vyacheslav Mikhed & Dubravka Ritter & Michael Vogan, 2020. "Financial Consequences of Identity Theft," Working Papers 20-33, Federal Reserve Bank of Philadelphia.
    14. Julia S. Cheney & Robert M. Hunt & Vyacheslav Mikhed & Dubravka Ritter & Michael Vogan, 2014. "Identity theft as a teachable moment," Working Papers 14-28, Federal Reserve Bank of Philadelphia.
    15. Greene, Claire & Stavins, Joanna, 2017. "Did the Target data breach change consumer assessments of payment card security?," Journal of Payments Strategy & Systems, Henry Stewart Publications, vol. 11(2), pages 121-133, August.
    16. Charles M. Kahn & José M. Liñares-Zegarra & Joanna Stavins, 2017. "Are there Social Spillovers in Consumers’ Security Assessments of Payment Instruments?," Journal of Financial Services Research, Springer;Western Finance Association, vol. 52(1), pages 5-34, October.
    17. Vyacheslav Mikhed & Michael Vogan, 2015. "Out of sight, out of mind: consumer reaction to news on data breaches and identity theft," Working Papers 15-42, Federal Reserve Bank of Philadelphia.
    18. Chun-Yu Ho & Nayoung Kim & Ying Rong & Xin Tian, 2022. "Promoting Mobile Payment with Price Incentives," Management Science, INFORMS, vol. 68(10), pages 7614-7630, October.
    19. Vania Silva & Esmeralda Ramalho & Carlos Vieira, 2016. "Is EMV adoption changing card payments? Evidence from the European Union," CEFAGE-UE Working Papers 2016_05, University of Evora, CEFAGE-UE (Portugal).
    20. Jacek Pietrucha & Grzegorz Maciejewski, 2020. "Precautionary Demand for Cash and Perceived Risk of Electronic Payments," Sustainability, MDPI, vol. 12(19), pages 1-25, September.
    21. Leo Van Hove & Farhod P. Karimov, 2016. "The role of risk in e-retailers’ adoption of payment methods: evidence for transition economies," Electronic Commerce Research, Springer, vol. 16(1), pages 27-72, March.
    22. Massimiliano Cologgi, 2023. "The security of retail payment instruments: evidence from supervisory data," Temi di discussione (Economic working papers) 30, Bank of Italy, Economic Research and International Relations Area.
    23. Nathan Blascak & Julia S. Cheney & Robert M. Hunt & Vyacheslav Mikhed & Dubravka Ritter & Michael Vogan, 2021. "Financial Consequences of Severe Identity Theft in the U.S," Working Papers 21-41, Federal Reserve Bank of Philadelphia.
    24. Nicole Jonker & Mirjam Plooij & Johan Verburg, 2015. "Does a public campaign influence debit card usage? Evidence from the Netherlands," DNB Working Papers 470, Netherlands Central Bank, Research Department.

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    More about this item

    Keywords

    debit card; fraud; media communication; payment behaviour;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth

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