Faster payments: market structure and policy considerations

Garth Baughman, Fumiko Hayashi, Mark D. Manuszak, Aaron Rosenbaum, Joanna Stavins and Kylie Stewart
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Mark D. Manuszak: https://www.federalreserve.gov/econres/mark-d-manuszak.htm

No 17-4, Current Policy Perspectives from Federal Reserve Bank of Boston

Abstract: The U.S. payments industry is in the process of developing ubiquitous, safe, faster electronic solutions for making a broad variety of business and personal payments. How this market for faster payments will evolve will be shaped by a range of economic forces, such as economies of scale and scope, network effects, switching costs, and product differentiation. Emerging technologies could alter these forces and lead to new organizational arrangements or market structures that are different from those in legacy payment markets to date. In light of this uncertainty, this paper examines three hypothetical market structures that may emerge: a dominant operator environment, a multi-operator environment, and a decentralized environment. Each of these market structures has different implications for the public policy objectives of efficiency, safety, and ubiquity. The paper also considers tools to promote positive outcomes in each market structure.

Keywords: payment system improvement; competition; faster payments; public policy; market structure; retail payments (search for similar items in EconPapers)
JEL-codes: D4 E42 G2 L1 (search for similar items in EconPapers)
Pages: 40 pages
Date: 2017-09-21
New Economics Papers: this item is included in nep-com, nep-mac, nep-mkt and nep-pay
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Citations: View citations in EconPapers (1)

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Related works:
Working Paper: Faster Payments: Market Structure and Policy Considerations (2017)
Working Paper: Faster Payments: Market Structure and Policy Considerations (2017)
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