30 March 2017
visit nextgenbanking.co.uk

Migration to e-payments gives huge boost to GDP and jobs - study

10 March 2016  |  9050 views  |  2 Woman shopping with credit card

The rise of electronic payments over the last five years has added nearly $300 billion to GDP across 70 countries and created millions of jobs, claims a new Visa-commissioned study.

For the study, Moody's Analytics analysed the impact of electronic payments on economic growth across 70 countries, which between them make up almost 95% of global GDP, between 2011 and 2015.

According to the report, increased use of electronic payment products, including credit, debit and prepaid cards, added $296 billion to GDP, while raising household consumption of goods and services by an average of 0.18% per year, with developing countries seeing the biggest boost.

Meanwhile, Moody's economists estimate that over the five years the rise of e-payments resulted in the equivalent to 2.6 million new jobs being created on average, annually. The two countries with the greatest average job increases were China and India, which, Moody's notes, both had large gains in employment due to the combination of fast growing labour productivity and increased card usage.

The study also suggests that the electronification of payments benefits governments and contributes to a more stable and open business environment while shrinking the grey economy. All this means higher tax revenue bases for governments, lower cash handling costs, guaranteed payments to merchants and greater financial inclusion for consumers.

Across the 70 countries, Moody's found that every one per cent increase in usage of electronic payments could produce, on average, an annual increase of approximately $104 billion in the consumption of goods and services. Assuming all future factors remain the same, this could result in an annual average increase of 0.04% to GDP attributable to card usage.

Mark Zandi, chief economist, Moody's Analytics, says: "Electronic payments are a major contributor to consumption, increased production, economic growth and employment creation. Those countries which saw large increases in card usage also saw larger contributions to overall growth in their economies."

Comments: (2)

Bo Harald
Bo Harald - ZEF and Real Time Economy Program - Helsinki region | 10 March, 2016, 11:26

Not to talk about e-invoicing - by now standard service in many e-banks for SMEs and consumers..

Be the first to give this comment the thumbs up 0 thumb ups! (Log in to thumb up)
Bo Harald
Bo Harald - ZEF and Real Time Economy Program - Helsinki region | 10 March, 2016, 11:28

A bit funny that the payment proposal part of payments - the e-invoice is not included here. Old fashioned orthodoxy... we have seen enough of by now..

 

Be the first to give this comment the thumbs up 0 thumb ups! (Log in to thumb up)
Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Cashless society like a mirage in the desert

Cashless society like a mirage in the desert

01 March 2016  |  10749 views  |  12 comments | 15 tweets | 14 linkedin
Sweden on course to be first cashless country

Sweden on course to be first cashless country

21 October 2015  |  19294 views  |  15 comments | 48 tweets | 52 linkedin
India joins Better Than Cash Alliance

India joins Better Than Cash Alliance

02 September 2015  |  7703 views  |  0 comments | 21 tweets | 10 linkedin
India proposes tax rebates for e-payments to discourage use of cash

India proposes tax rebates for e-payments to discourage use of cash

24 June 2015  |  8405 views  |  3 comments | 27 tweets | 13 linkedin
Danish shops to be given right to refuse cash

Danish shops to be given right to refuse cash

07 May 2015  |  21751 views  |  15 comments | 67 tweets | 42 linkedin
India lays out plan to ditch cash for mobile payments

India lays out plan to ditch cash for mobile payments

09 February 2015  |  12153 views  |  3 comments | 21 tweets | 23 linkedin
Rwanda makes cashless push in bid to increase financial inclusion

Rwanda makes cashless push in bid to increase financial inclusion

30 October 2014  |  13596 views  |  1 comments | 13 tweets | 6 linkedin
Money2020 stirs up cashless society debate

Money2020 stirs up cashless society debate

11 October 2013  |  16575 views  |  6 comments | 18 tweets | 9 linkedin
Dutch central bank comes down in favour of hard cash

Dutch central bank comes down in favour of hard cash

28 June 2013  |  9242 views  |  3 comments | 12 tweets | 9 linkedin
Nigeria to roll out multi-purpose national ID and payment cards

Nigeria to roll out multi-purpose national ID and payment cards

09 May 2013  |  8435 views  |  1 comments | 5 tweets | 3 linkedin
'Better Than Cash Alliance' to push e-payments in fight against poverty

'Better Than Cash Alliance' to push e-payments in fight against poverty

20 September 2012  |  6760 views  |  0 comments
E-payments behind quarter of Canadian GDP growth - Visa

E-payments behind quarter of Canadian GDP growth - Visa

12 September 2012  |  4274 views  |  0 comments

Related company news

 

Related blogs

Create a blog about this story (membership required)
visit abe-eba.euVisit capgemini.com

Top topics

Most viewed Most shared
Danish banks add Dankort payments to mobile walletsDanish banks add Dankort payments to mobil...
15078 views comments | 2 tweets | 7 linkedin
European Commission opens public consultation on fintechEuropean Commission opens public consultat...
13632 views comments | 53 tweets | 32 linkedin
MAS to roll out national KYC utility for SingaporeMAS to roll out national KYC utility for S...
12417 views comments | 33 tweets | 45 linkedin
hands typing furiouslyTwo key technologies driving Machine Learn...
8883 views 0 | 16 tweets | 4 linkedin

Featured job

Six Figure Base + Commission + Stock Options
London

Find your next job