18 March 2005

Survey on the costs involved in POS payment products

The Working Group of De Nederlandsche Bank released a survey on the costs of payment products. The costs involved in making payments at a point of sale, either in cash or using a card, are considerable. These costs relate to the production of means of payment, the construction and maintenance of the underlying infrastructure and the processing of payment transactions.

It turns out that the most economical means of payment is the electronic purse, irrespective of the amount paid, while the most costly is the credit card. When comparing cash to the debit card, cash turns out to be most cost-efficient for payments below EUR 11.63, while the debit card turns out to be cheaper for higher amounts.

Paying more of the larger amounts by debit card could bring down the cost to society, but cost savings would be most pronounced if more payments were made by e-purse, irrespective of the specific transaction amount.

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