Payment clearing and settlement systems

• February 10, 2021

  Changing how we pay

  Speech summary Timothy Lane Institute for Data Valorisation Montréal, Quebec

  Deputy Governor Timothy Lane discusses how the pandemic has accelerated the digitalization of the economy.

  Content Type(s): Press, Speeches and appearances, Speech summaries Topic(s): Bank notes, Coronavirus disease (COVID-19), Cryptocurrencies, Digital currencies and fintech, Payment clearing and settlement systems
• February 10, 2021

  Payments innovation beyond the pandemic

  Remarks (delivered virtually) Timothy Lane Institute for Data Valorisation Montréal, Quebec

  Deputy Governor Timothy Lane talks about how the Bank of Canada is contributing to the modernization of our payments ecosystem, and how the COVID-19 pandemic has highlighted the need to make payments more convenient for all Canadians.

  Content Type(s): Press, Speeches and appearances, Remarks Topic(s): Bank notes, Coronavirus disease (COVID-19), Cryptocurrencies, Digital currencies and fintech, Payment clearing and settlement systems

• Distributional Effects of Payment Card Pricing and Merchant Cost Pass-through in Canada and the United States

  Staff Working Paper 2021-8 Marie-Hélène Felt, Fumiko Hayashi, Joanna Stavins, Angelika Welte

  Although credit cards are more expensive for merchants to accept than cash or debit cards, merchants typically pass through their costs evenly to all customers. Along with consumer card rewards and banking fees, this creates cross-subsidies between payment methods. Because higher-income individuals tend to use credit cards more than those with lower incomes, our results indicate that these cross-subsidies might lead to regressive distributional effects.

  Content Type(s): Staff research, Staff working papers Topic(s): Bank notes, Financial institutions, Financial services, Market structure and pricing, Payment clearing and settlement systems JEL Code(s): D, D1, D12, D2, D23, D3, D31, E, E4, E42, G, G2, G21, L, L8, L81

• Estimating Policy Functions in Payments Systems Using Reinforcement Learning

  Staff Working Paper 2021-7 Pablo S. Castro, Ajit Desai, Han Du, Rodney J. Garratt, Francisco Rivadeneyra

  We demonstrate the ability of reinforcement learning techniques to estimate the best-response functions of banks participating in high-value payments systems—a real-world strategic game of incomplete information.

  Content Type(s): Staff research, Staff working papers Topic(s): Digital currencies and fintech, Financial institutions, Financial system regulation and policies, Payment clearing and settlement systems JEL Code(s): A, A1, A12, C, C7, D, D8, D83, E, E4, E42, E5, E58