Competition–cooperation nexus in the European retail payments market: Views from a network industry perspective

Abstract

Retail payments, especially card payments, have come under scrutiny from competition authorities in recent years. This is understandable, as healthy competition among payment service providers greatly enhances the efficiency of retail payments markets. Given the inherent network features of the retail payments industry, however, the need for cooperation in building payment infrastructures and defining relevant standards should also be recognised. This paper considers the ‘competition–cooperation’ nexus in the European context and outlines general choices policy makers face in trying to ensure both adequate upstream cooperation and effective downstream competition. The discussion takes into consideration how bodies such as the Euro Retail Payments Board provide a basis for ‘inter-stakeholder’ cooperation in adopting payment methods that provide the best efficiency outcomes for society as a whole.