Benefits of cash by Malte Krueger Franz Seitz

Author:Malte Krueger, Franz Seitz
Language: deu
Format: epub
Publisher: Fritz Knapp Verlag
Published: 2017-11-15T00:00:00+00:00

6.3 Benchmark for card fees

It is interesting to note that the costs of cash play a key part in the regulation of card payments. In many card payment systems, there are universal interchange fees, which are contentious in competition law. The European Commission has introduced upper limits for these fees for debit and credit card payments based on a theoretical concept called the “tourist test”. 47 This test ensures that interchange fees are determined in such a way that card payments cost retailers exactly the same as a cash payment would. The European Commission conducted a detailed study to determine the costs that a retailer incurs for both cash and card payments (European Commission, 2015).

Should cash no longer constitute an alternative to card payments, this method of determining interchange fees could continue to be applied only if there was a new widespread payment instrument to compete with cards. The question is what form could and should such an instrument take.

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