Governance of Payment Systems: A Theoretical Framework and Cross-Country Comparison

36 Pages Posted: 5 Aug 2014 Last revised: 23 Sep 2014

See all articles by Bruce J. Summers

Bruce J. Summers

Consultant on Money, Banking, and Payments

Kirstin E. Wells

Board of Governors of the Federal Reserve System

Date Written: July 5, 2014

Abstract

We develop and test the effectiveness of a theoretical governance model for general purpose payment systems (GPPS), systems that are used by individuals, businesses and merchants, and state, local and federal government entities to make and receive payments. We test for effective governance across six reference countries using measures that are based on evolving regulatory norms, finding that governance in Australia, the European Union, and the United Kingdom aligns with the theoretical model, and that their governance is effective. Payment system governance in Japan, Canada, and the United States does not align with the theoretical model, and is shown not to be effective according to the measures. Our findings indicate that national government is being called on increasingly to set and oversee the accomplishment of public policy objectives, and that their involvement is consistent with effective governance.

Keywords: payment systems, governance

JEL Classification: D21, D29, D43, E40, E44, E58, H54, L00

Suggested Citation

Summers, Bruce J. and Wells, Kirstin E., Governance of Payment Systems: A Theoretical Framework and Cross-Country Comparison (July 5, 2014). Available at SSRN: https://ssrn.com/abstract=2476552 or http://dx.doi.org/10.2139/ssrn.2476552

Bruce J. Summers (Contact Author)

Consultant on Money, Banking, and Payments ( email )

VA
United States
540-464-1790 (Phone)

Kirstin E. Wells

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States

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