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The Hidden Costs of Cards

Categories : Cash is efficient, Costs of cash versus costs of electronic payment instruments
December 14, 2016
Published in : Cost of transactions, Costs of payments, Data breach, Fraud, Payment instruments
There are more costs associated to the cost of cards then is usually unveiled. This report explores those costs and compares them to the cost of cash.

Payments are a big business. According to the Boston Consulting Group,  payments generated $1.1 trillion in revenue in 2015, representing 29% of global banking revenues. By 2025, they are projected to reach nearly $2 trillion. Payment cards are the most important and the fastest growing payment instrument. According to the World Payments Report, debit cards accounted for 45.7% of electronic transactions globally in 2014 and grew by 12.8%.

Most of the research focusing on the cost of payments looks at the real, visible and tangible costs and compares them to the cost of cash. There are, however, more costs associated with payments than those direct costs. In the Hidden Costs of Card Payments, Diederik Bruggink and Guillaume Lepecq analyse and, when possible, quantify these costs. They include costs related to:

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