Contents Introduction The new economy in the information society creates a new business environment. What is different is that more and more business gets transacted in a computer-mediated environment. Transactions, bill payments, purchasing, reservations (hotels, travel or cinema tickets) are done electronically. A Credit Card is an electronic payment system that is used more than two decades....

Payment and settlement systems support financial transactions through credit, keep records of transactions by adjusting credit balances and require such balances to be periodically reset through settlement. We study the efficient design of financial trades when the payment system can monitor some transactions better than others and when liquidity provision in the form of settlement is costly. E...

Charles Sprenger and Joanna Stavins Abstract: Approximately half of credit card holders in the United States regularly carry unpaid credit card debt. These so‐called “revolvers” exhibit payment behavior that differs from that of those who repay their entire credit card balance every month. Previous literature has focused on the adoption of debit cards by people who carry credit card balances, ...

Secure methods of payment are needed before we will see widespread commercial use of the Internet. Recently proposed and implemented payment methods follow one of three models: electronic currency, credit-debit, and secure credit card transactions. Such payment services have diierent strengths and weaknesses with respect to the requirements of of security, reliability , scalability, anonymity, ...

We present a dynamic cash-management model where agents choose whether to pay with cash or credit at every point in time. In the model credit usage depends on the current stock of cash, a novel result that matches recent micro evidence on household’s payment choices. The optimality of such decision rule is novel and cannot be obtained by models where cash-credit decisions are made at the “begin...

In this study, an EOQ (Economic Order Quantity) inventory mathematical model is constructed for a deteriorating item having time dependent demand when delay in payment is permissible. The deterioration rate is assumed to be a constant and the time varying demand rate is taken to be an exponential declining function of time. Mathematical models are also derived under two different circumstances,...

In this paper we present evidence from a field experiment on the effect of text message reminders and credit card APR (annual payment rate) information on credit scores of low-tomoderate-income individuals. We find that individuals who initially had a low credit score benefited significantly from receiving the text reminders, while individuals who initially had a mid or high score did not. The ...

Recent roll-outs of contactless payment infrastructures – particularly in Austria and Germany – have raised concerns about the security of contactless payment cards and Near Field Communication (NFC). There are well-known attack scenarios like relay attacks and skimming of credit card numbers. However, banks and credit card schemes often mitigate these attacks. They explain that attacks are imp...

Extending Ireland’s (1994) model, this paper analyzes an international economy where cash or credit can be used for payment. Foreign trade credit is more costly than its domestic analog. A depreciation of the real exchange rate is associated with an external surplus and a reduced share of imports purchased with credit. Economic growth slows when foreign trade credit becomes the predominant mean...

In this article, we present a theoretical model to study the ability of banks to influence the consumer’s payment instrument choice. Unlike most two-sided market models where benefits are exogenous, we explicitly consider how consumers’ utility and merchants’ profits increase from additional sales resulting from greater security and access to credit lines. Consumers participate in payment card ...