Card-Sales Response to Merchant Contactless Payment Acceptance: Causal Evidence
34 Pages Posted: 3 Oct 2019
Date Written: September 25, 2019
Disruptive innovations in digital payments are happening in a large number of countries around the world. While consumers may access to a wide variety of payment technologies, a natural question arises: does accepting a new payment technology allow merchants to increase their business sales? Using matching and difference-in-difference techniques on a unique sample of about 275,580 merchants in France, we find that accepting contactless payments in 2018 increases on average the card-sales amount by 17 percent (and by 20 percent the card-sales count) compared to merchants who do not accept contactless payments. We also find evidence that accepting contactless payments exerts a positive spillover of about 3 percent in the amount of contact card sales, and is also more profitable for small merchants and new entrepreneurs.
Keywords: Card acceptance, contactless cards, digital payments, difference in difference
JEL Classification: C21, E21, E42, O33
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