The report “National Payments Schemes: Drivers of Economic and Social Benefits?” shows domestic payment schemes, which predominantly run debit cards, are an economic-sound alternative to international giants MasterCard and Visa as they offer customized services and local decision making. The study also showed their costs are 25-75% (45% on average) lower than international competitors. Reasons for inferior costs include their business models with a focus on tight budgets, lack of marketing initiatives and high innovation, lower margins and lower-priced supplies, which more than compensate scale.
The report suggests to regulators to remain neutral between market players and to take care of only focusing on lowering costs since this could drive to long-term unwanted results for the economy. Particularly, it points that geopolitical issues might play a role as evidenced in Russia. In Europe it will become increasingly difficult to define country markets vs. pan-European, which might lead to consolidation.
Two successful business cases are presented: Multibanco in Portugal and Quickteller in Nigeria, which added capabilities such as bill payments and interbank transfers in ATMs, thus adding more tools than those made available by international players.