• Corpus ID: 9895969

Consumers Really Benefit from Payment Card Rewards ?

  title={Consumers Really Benefit from Payment Card Rewards ?},
  author={By Fumiko Hayashi},
Payment card rewards programs have become increasingly popular in the United States. Nearly all large credit card issuers offer rewards to customers for using their cards, as do more than a third of depository institutions for using debit cards. Recent surveys suggest that many consumers now receive rewards. And rewards are becoming more generous and diversified, ranging from 5 percent cash-back bonuses for gasoline purchases, to free airline miles, to gifts to charity. But do consumers really… 

Figures from this paper

The Economics of Payment Card Fee Structure: Policy Considerations of Payment Card Rewards
This paper considers possible public policies that could improve efficiency and welfare distribution in the U.S. retail payments industry. Mainly, four options, i) encouraging competition; ii)
The Economics of Payment Card Fee Structure: What is the Optimal Balance between Merchant Fee and Payment Card Rewards?
This paper theoretically considers the optimal balance between the merchant fee and the cardholder fee (rewards) from both efficiency and equity perspectives. First, the paper constructs the models
Influence of Social Distancing Behavior and Cross-Cultural Motivation on Consumers’ Attitude to Using M-Payment Services
With the sustainable economy and the development of innovative technology, China is anticipated to have a large number of mobile payment (m-payment) users due to cultural influences and population


Consumer Choice and Merchant Acceptance of Payment Media
We study the ability of banks and merchants to influence the consumer's payment instrument choice. Consumers participate in payment card networks to insure themselves against three types of shocks|
The Economics of Payment Card Fee Structure: What Drives Payment Card Rewards?
This paper investigates potential market forces that cause payment card rewards even when providing payment card rewards is not the most efficient. Three factors-oligopolistic merchants,
Who Pays for Credit Cards
The authors model side payments in a competitive credit-card market. If competitive retailers absorb the cost of accepting credit cards by charging a higher goods price to everyone, then someone must
Payment Card Rewards Programs and Consumer Payment Choice
By using a unique data set that contains detailed information about consumer payment choice and consumers' attitudes toward each payment method, we estimate the effects of payment card rewards on
A Puzzle of Card Payment Pricing: Why Are Merchants Still Accepting Card Payments?
This paper presents models that explain why merchants accept payment cards even when the fees they face exceed the transactional benefits they receive from a card transaction. The prevalent
Payments are no free lunch
Total costs of the payments system to society are considerable. These costs can be higher or lower depending on the use of payment instruments that are less or more cost efficient. Empirical evidence
Market Structure and Credit Card Pricing: What Drives the Interchange?
This paper presents a model for the credit card industry, where oligopolistic card networks price their products in a complex marketplace with competing payment instruments, rational
Consumer Behavior and Payment Choice: 2006 Conference Summary
This paper summarizes the proceedings of the second Consumer Behavior and Payment Choice conference, held at the Federal Reserve Bank of Boston on July 25–27, 2006. These conferences are unique in
Cooperation Among Competitors: Some Economics of Payment Card Associations
We analyze platforms in two-sided markets with network externalities, using the specific context of a payment card association. We study the cooperative determination of the interchange fee by member