Card acceptance and surcharging: the role of costs and competition
DNB Working Papers from Netherlands Central Bank, Research Department
The payment cards market is a two-sided market. Cost sensitivity of both consumers and merchants for card services influences total demand. Survey data of Dutch merchants shows that costs, and competition affect acceptance as well as surcharging decisions. Merchants who find payment cards expensive are less likely to accept them and more likely to surcharge their customers for using them. Merchants who face any competition accept debit card payments relatively more often than merchants with monopoly power, and they are less likely to surcharge their customers for debit card usage. Intense competition leads to higher credit card acceptance.
Keywords: retail payments; merchants; costs; two-sided markets; competition; pricing; surcharging (search for similar items in EconPapers)
JEL-codes: D23 D40 E41 G20 (search for similar items in EconPapers)
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Journal Article: Card Acceptance and Surcharging: the Role of Costs and Competition (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:dnb:dnbwpp:300
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