Angelika holds a PhD in Mathematics and a MA in Economics. In her work, she uses empirical microeconomics to understand why and how consumers and firms choose payment methods. This year, Angelika is working on a project that will provide insights in the merchant acquiring industry in Canada. Merchant acquirers have a central role in card payment system as they connect card accepting businesses to the payment networks, authorize and process card transactions and may also provide point-of-sale equipment to merchants. The goal of this project is to better understand the structure of the acquiring market and how it relates to payment efficiency.
Recent data show that the use of credit cards in Canada has been increasing, while the use of cash has been declining. At the same time, only two-thirds of small or medium-sized businesses accept credit cards.
Using data from our 2014 cost-of-payments survey, we calculate resource costs for cash, debit cards and credit cards. For each payment method, we examine the total cost incurred by consumers, retailers, financial institutions and infrastructures, the Royal Canadian Mint and the Bank of Canada.