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PayTech on BigTech platforms

Author

Listed:
  • Chiu, Jonathan
  • Koeppl, Thorsten V.

Abstract

Why do BigTech platforms introduce payment services? And do their users benefit? Digital platforms often run business models where activities on the platform generate data that can be monetized off the platform. The platform then trades off the value of such data against the cost that arises from subsidizing activities in order to compensate users for their loss of privacy. The way data interact with payments determines whether payments are introduced and how the introduction impacts users. When data help to provide better payments (data-driven payments), platforms have too little incentives to introduce payments, even though users benefit. Introduction is more likely when payments also generate additional data (payment-driven data), but the adoption of better payments may then hurt users.

Suggested Citation

  • Chiu, Jonathan & Koeppl, Thorsten V., 2026. "PayTech on BigTech platforms," Journal of Banking & Finance, Elsevier, vol. 182(C).
    • Handle: RePEc:eee:jbfina:v:182:y:2026:i:c:s0378426625002055
    DOI: 10.1016/j.jbankfin.2025.107585
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Systems; Standards; Regimes; Government and the Monetary System
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

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