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Factors impeding the use of electronic payment instruments in emerging economies: The case of Colombia
Journal of Payments Strategy & Systems,
10
(4),
363-382
(2017)
Abstract
Using a novel dataset for the five major cities in Colombia, this paper studies the factors that determine access, usage and acceptance of different payment instruments. It shows that, as may be the case in many emerging economies, the use of electronic payments for day-to-day purchases is low, even with adequate access to transactional financial products and services. This result is largely explained by the costs and the limited levels of acceptance by merchants. Other factors such as income, financial education, trust and informality are also important deterrents to the adoption and usage of electronic payments.
Keywords: electronic payments; twosided markets; emerging economies; informality; limited acceptance; payment booklets
The full article is available to subscribers to the journal.
Author's Biography
Carlos A. Arango-Arango is a principal researcher and adviser in the Payment Systems and Banking Operations Department at the Central Bank of Colombia. His current research focuses on payments economics and financial inclusion. He has published research on industrial organisation, labour and monetary economics and has worked at the Canadian Central Bank and the World Bank. He received his PhD in economics from the University of Illinois at Urbana-Champaign.
Nicolás F. Suárez-Ariza is an adviser in the Payment Systems and Banking Operations Department at the Central Bank of Colombia. His current research focuses on payment instruments, notably the determinants of their usage and acceptance. He received his MSc title in quantitative finance and actuarial sciences from Tilburg University.
