The Costs of Point‐of‐Sale Payments in Canada
Staff Discussion Paper/Document danalyse du personnel 2017\4
The Costs of Point\of\Sale
Payments in Canada
by Anneke Kosse, Heng Chen, Marie\Hlne Felt, Valry Dongmo
Jiongo, Kerry Nield and Angelika Welte
Bank of Canada staff discussion papers are completed staff research studies on a wide variety of subjects relevant to central bank policy,
produced independently from the Banks Governing Council. This research may support or challenge prevailing policy orthodoxy. Therefore, the
views expressed in this paper are solely those of the authors and may differ from official Bank of Canada views. No responsibility for them
should be attributed to the Bank.
bank\banque\canada.ca
Bank of Canada Staff Discussion Paper 2017-4
March 2017
The Costs of Point-of-Sale Payments in Canada
by
Anneke Kosse,1 Heng Chen,2 Marie-Hlne Felt,2 Valry Dongmo Jiongo,2
Kerry Nield2 and Angelika Welte2
1De
Nederlandsche Bank
Amsterdam, The Netherlands
and
Currency Department
Bank of Canada
Ottawa, Ontario, Canada K1A 0G9
2Currency
Department
Bank of Canada
Ottawa, Ontario, Canada K1A 0G9
costofpayments-coutdespaiements@bank-banque-canada.ca
ISSN 1914-0568
? 2017 Bank of Canada
Acknowledgements
This study would not have been possible without the contribution of various trade
organizations, financial institutions, cash transportation companies, the Canadian Bankers
Association and other individual market participants. The authors are also grateful to the
Bank of Canada's Currency Department regional teams for their recruitment of respondents
and advice. Many thanks to Ben Fung and Kim P. Huynh for their continuing support and
valuable advice and guidance, to Cline Armstrong for her help on the communication
aspects of the study, and to Jean-Fran?ois Beaumont (Statistics Canada) and Alan
Roshwalb (Ipsos Reid) for their expert comments and suggestions. We also thank our
colleagues, especially Rene Bidart, Stan Hatko, Casey Jones, Emma McGuire, Gradon
Nicholls, Zixin Nie, Rallye Shen, Kyle Vincent and Blair Williams for excellent research
assistance, and Theodoros Garanzotis and Gerald Stuber for helpful comments and
suggestions. We acknowledge Shelley Edwards, Jessica Wu and the Ipsos Reid team for
their collaboration on this project. Finally, we thank our colleagues at other central banks
for sharing their experiences and lessons learned: Terje ?m?s (Norges Bank), Maria Tereza
Cavaco (Banco de Portugal), David Emery (Reserve Bank of Australia), Geoffrey Gerdes
(Federal Reserve Board), Nicole Jonker (De Nederlandsche Bank), Anders M?lgaard
Pedersen (Danmarks Nationalbank), Bj?rn Segendor (Sveriges Riksbank) and Chris
Stewart (Reserve Bank of Australia). This paper was written when Anneke Kosse was
seconded from De Nederlandsche Bank to the Bank of Canada.
i
Abstract
This study provides insight into the costs of cash, debit card and credit card payments made
at the point of sale in Canada in 2014. For each payment method, it examines the total
resource costs, which capture the overall use of resources by society as a whole. Using
extensive survey data from retailers, financial institutions and cash transportation
companies as well as internal and external data sources, the results show that the resource
costs of payments in Canada are non-negligible (0.78 per cent of GDP). Credit cards are
most costly in terms of resource costs per transaction, while cash carries the highest
resource costs per dollar transacted. Debit cards are the least costly, both in terms of costs
per transaction and costs per dollar in sales. The study also demonstrates how the costs
vary with transaction sizes. Considering the variable resource costs only, cash is found to
be cheapest for transactions up to $6, while debit cards are the least costly for transactions
larger than $6. The study also looks into the total private costs, which are the costs incurred
by each stakeholder, thereby providing insight into how costs are affecting the use and
acceptance of payment methods.
Bank topics: Bank notes; Financial institutions; Payment clearing and settlement
systems; Digital currencies
JEL codes: D12, D23, D24, E41, E42, G21, L2
Rsum
Cette tude permet de mieux cerner les co?ts des paiements effectus en argent comptant,
par carte de dbit et par carte de crdit dans les points de vente au Canada en 2014. Pour
chacun de ces modes de paiement, nous examinons lensemble des co?ts en ressources, qui
rendent compte de lutilisation globale des ressources par la socit tout entire. Les
rsultats, fonds sur de nombreuses donnes denqute auprs des dtaillants, des
institutions financires et des socits de transport de fonds, ainsi que sur des sources de
donnes internes et externes, montrent que les co?ts en ressources associs aux paiements
au Canada ne sont pas ngligeables (0,78 % du PIB). Les paiements par carte de crdit sont
les plus co?teux par transaction sur le plan de lutilisation des ressources, tandis que les
paiements en argent comptant entra?nent les co?ts en ressources les plus importants par
dollar de vente. Les rglements par carte de dbit sont les moins co?teux par transaction et
par dollar de vente. Par ailleurs, nous montrons comment les co?ts varient selon le montant
des transactions. Du point de vue des seuls co?ts variables en ressources, les paiements les
moins co?teux dcoulent des transactions en argent comptant allant jusqu 6 $ et des
ii
transactions par carte de dbit de plus de 6 $. Ltude porte galement sur lensemble des
co?ts individuels, savoir les co?ts assums par chaque partie prenante, ce qui permet de
mieux comprendre leur incidence sur lutilisation et lacceptation des diffrents modes de
paiement.
Sujets : Billets de banque ; Institutions financires ; Systmes de compensation et de
rglement des paiements ; Monnaies numriques
Codes JEL : D12, D23, D24, E41, E42, G21, L2
iii
................
................
In order to avoid copyright disputes, this page is only a partial summary.
To fulfill the demand for quickly locating and searching documents.
It is intelligent file search solution for home and business.
Related download
- mts prepaid wireless personal
- 2018 payments canada
- mastercard canada interchange programs
- cibc smart prepaid visa card cibc smart prepaid travel
- rbc royal bank non reloadable visa commercial prepaid card
- new consumer protection measures for prepaid credit cards
- rbc royal bank prepaid card application form
- the costs of point‐of‐sale payments in canada
- new measures to protect consumers of prepaid credit cards
- business payments 2022 how industry 4 0 is defining the
Related searches
- schedule of loan payments template
- the importance of communication in the workplace
- state of michigan payments online
- present value of future payments calculator
- state of michigan estimated tax payments 2019
- cost of living in canada for retirees
- the role of communication in the workplace
- the story of lucifer in the bible
- the fall of lucifer in the bible
- in the arms of the angels
- in the arms of the angels youtube
- retail point of sale systems