Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/272979 
Year of Publication: 
2022
Series/Report no.: 
Bank of Canada Staff Working Paper No. 2022-35
Publisher: 
Bank of Canada, Ottawa
Abstract: 
Why do BigTech platforms introduce payment services? Digital platforms often run business models where activities on the platform generate data that can be monetized off the platform. There is a trade-off between the value of such data and the privacy concerns of users, since platforms need to compensate users for their privacy loss by subsidizing activities. The nature of complementarities between data and payments determines whether and how payment services are provided. When data help to provide better payments (data-driven payments), platforms have too little incentive to adopt. When payments generate additional data (payments-driven data), platforms may adopt payments inefficiently.
Subjects: 
Digital currencies and fintech
Payment clearing and settlement systems
JEL: 
D8
E42
L1
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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