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Network vulnerabilities and risks in the retail payment system

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  • Catharine Lemieux

Abstract

Changes in retail payments technology will impact the operational risk of commercial banks. This study provides a more in-depth discussion of the ramifications these changes have for bank supervision and policy makers. In addition to operational risk concerns identified by previous researchers, this paper identifies network vulnerabilities as a potential resiliency concern.

Suggested Citation

  • Catharine Lemieux, 2003. "Network vulnerabilities and risks in the retail payment system," Emerging Issues, Federal Reserve Bank of Chicago.
    • Handle: RePEc:fip:fedhei:y:2003:n:eps-2003-1f
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    References listed on IDEAS

    as
    1. Sujit Chakravorti & Emery Kobor, 2003. "Why invest in payment innovations?," Emerging Issues, Federal Reserve Bank of Chicago, issue Jun.
    2. Loretta J. Mester, 2000. "The changing nature of the payments system: should new players mean new rules?," Business Review, Federal Reserve Bank of Philadelphia, issue Mar, pages 3-26.
    3. Marvin Goodfriend, 1991. "Money, credit, banking, and payments system policy," Economic Review, Federal Reserve Bank of Richmond, vol. 77(Jan), pages 7-23.
    4. Terri Bradford & Matt Davies & Stuart E. Weiner, 2002. "Nonbanks in the payments system," Payments System Research Working Paper PSR WP 02-02, Federal Reserve Bank of Kansas City.
    5. Robert DeYoung & Mark J. Flannery & William W. Lang & Sorin M. Sorescu, 1998. "The informational advantage of specialized monitors: the case of bank examiners," Working Paper Series WP-98-4, Federal Reserve Bank of Chicago.
    6. William Roberds, 1998. "The impact of fraud on new methods of retail payment," Economic Review, Federal Reserve Bank of Atlanta, vol. 83(Q 1), pages 42-52.
    7. Mark J. Flannery, 1998. "Modernizing financial regulation (again)," Proceedings, Federal Reserve Bank of San Francisco, issue Sep.
    8. Tara N. Rice, 2003. "The importance of payments-driven revenues to franchise value and in estimating bank performance," Emerging Issues, Federal Reserve Bank of Chicago.
    9. JAMES J. McANDREWS, 1999. "E‐Money And Payment System Risks," Contemporary Economic Policy, Western Economic Association International, vol. 17(3), pages 348-357, July.
    10. Kenneth N. Kuttner & James J. McAndrews, 2001. "Personal on-line payments," Economic Policy Review, Federal Reserve Bank of New York, issue Dec, pages 35-50.
    11. Tara N. Rice & Kristin D. Stanton, 2003. "Estimating the volume of payments-driven revenues," Emerging Issues, Federal Reserve Bank of Chicago.
    12. Paul E. Kellogg, 2003. "Evolving operational risk management for retail payments," Emerging Issues, Federal Reserve Bank of Chicago.
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    Keywords

    Payment systems; Bank supervision;

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