Cost savings from electronic payments and ATMs in Europe

Goran Bergendahl, David B. Humphrey, Ted Lindblom and Magnus Willesson

No 03-16, Working Papers from Federal Reserve Bank of Philadelphia

Abstract: Electronic payments are considerably cheaper than their paper-based alternatives. Similarly, ATMs are a more cost-efficient way to deliver certain depositor services than are branch offices. As the share of electronic payments in 12 European countries rose from 0.43 in 1987 to 0.79 in 1999 and ATMs expanded while the number of branch offices was constant, bank operating costs are estimated to be $32 billion lower than they otherwise might have been, saving 0.38% of the 12 nations' GDP. The authors' results are robust to the form of cost function estimated-composite, Fourier, or translog. ; Also issued as Payment Cards Center Discussion Paper No. 03-14

Keywords: Automated tellers; Electronic funds transfers (search for similar items in EconPapers)
Date: 2003
New Economics Papers: this item is included in nep-eec, nep-his, nep-ino and nep-mon
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Citations: View citations in EconPapers (8)

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