FIT IN Initiative Policy papers
Building on insights from the economics literature, particularly on two-sided markets, and experiences from other jurisdictions, the policy paper sheds light on issues related to pricing of digital payment methods, in particular on debit cards and Unified Payments Interface (UPI) transactions. This policy paper was prepared in response to a discussion paper by the Reserve Bank of India.
- Milo Bianchi, Matthieu Bouvard, Renato Gomes, Andrew Rhodes and Vatsala Shreeti, Mobile Payments and Interoperability: Insights from the Academic Literature, December 2021.
In this policy paper, TSE researchers connected various streams of academic literature to shed light on how the degree of interoperability in mobile payments affects market outcomes and welfare. They organized their discussion around four dimensions of interoperability:
- Mobile network interoperability in connection with the IO literature on tying.
- Platform level interoperability in light of the literature on compatibility. We also build on the behavioral IO literature to suggest how the effects of interoperability may be very heterogeneous across various types of firms and consumers, or even backfire.
- Interoperability in the cash-in-cash-out agent network, in light of the literature on co-investment in network industries, and of more specific studies on ATMs’ interoperability.
- How the literature in banking and on data ownership can be used to understand interoperability of data.
They conclude with some broader remarks on policy implications and on possible directions for future research.