ATM Direct Charging Reform: the Effect of Independent Deployers on Welfare

Donze, Jocelyn and Dubec, Isabelle (2010): ATM Direct Charging Reform: the Effect of Independent Deployers on Welfare.

Abstract

In Australia, on the 3rd of March 2009, the interchange fees on shared ATM transactions were removed and replaced by fees directly set and received by the ATM owners. We develop a model to study how the entry of independent ATM deployers (IADs) affects welfare under this direct charging scheme. Paradoxically, we show that the IAD entry benefits banks. It may be good for consumers if they sufficiently value the associated growth of the ATM network.

• Item Type: MPRA Paper
• Language: English
• Keywords: ATMs; Direct Charging Reform; Independent Deployers
• Subjects: G - Financial Economics > G2 - Financial Institutions and Services; L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance

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