Central Banking

Adopting electronic retail payments boosts real economy, says ECB paper

Credit Cards

Migrating from paper to electronic retail payments boosts GDP, consumption and trade in an economy, according to a working paper published by the European Central Bank today.

The paper, Retail Payments and the Real Economy by Iftekhar Hasan, Tania De Renzis and Heiko Schmiedel, says the effect is strongest for card payments, followed by credit transfers and direct debits.

Card payments, the paper explains, enable consumers to access credit. Not only does this allow for "consumption smoothing"

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