Group items tagged

"Credit card perks reward rich Americans to the detriment of the poor. The $200 in cash back you got using your fancy new rewards card often comes at the expense of someone who can't afford it."

"Mastercard will be phasing out the magnetic stripe on its payment cards. They will start to disappear in newly-issued cards in Europe in 2024, while U.S. banks will no longer be required to issue chip cards with a magnetic stripe starting in 2027. By 2029, no new cards will be issued with a magnetic stripe, except for prepaid cards in the United States and Canada, and Mastercard expects that none of its credit or debit cards will have a magnetic stripe by 2033."

"Sub-acquirers, also known as payment facilitators, have played a vital role in fostering merchant digital payments acceptance, particularly in developing countries. To provide access to digital payments (ie card acceptance) to merchants, sub-acquirers do not have a direct connection with the card network but through the acquirer. This paper aims to study the optimal pricing in the payments industry when: i) the sub-acquirers and acquirers compete in the same downstream market, and ii) the sub-acquirers enter niche markets that are not covered yet (eg micro and small-sized merchants). In the first scenario, a conflict arises as the acquirer might have incentives to deter entry by charging prohibitive access fees. In the second scenario, the acquirer obtains an extra profit from granting access to the card network for the sub-acquirers, and welfare increases. That said, the regulator can play a relevant role in the first scenario by setting an access fee to allow socially but not privately desirable entry."