Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/153575
Authors: 
Carbó-Valverde, Santiago
Liñares-Zegarra, José M.
Year of Publication: 
2009
Series/Report no.: 
ECB Working Paper 1141
Abstract: 
Card issuers have mainly relied on rewards programs as their main strategic driver to increase electronic payments. However, there is scarce evidence on the effectiveness of rewards programs. This paper offers novel evidence on two key issues: i) it measures the impact of rewards programs on the use of payment cards; and ii) it quantifies their economic impact in terms of the cash substitution. The results show that rewards may significantly modify preferences for card payments, their economic impact vary significantly across types of rewards and merchant activities and rewards seem to be more effective on average for debit cardholders.
Subjects: 
cardholders
merchants
payment cards
preferences
rewards
JEL: 
G20
D12
E41
Document Type: 
Working Paper

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