Guide for Measuring Retail Payment Costs

Guide for Measuring Retail Payment Costs

The Practical Guide for Measuring Retail Payment Costs suggests a comprehensive framework to estimate retail payment costs for the demand side, supply side and total economy, while calculating savings in the move from cash and paper-based to electronic payment instruments.


The guide complements the “Retail Payments Policy Package,” which consists of documents, reports, and guidelines, in which the World Bank Group has synthesized years of technical assistance programs and research in the retail payments space.

Establishing a sound economic baseline for national retail payment systems in terms of costs of different payment instruments can better guide the development of the National Payment System and enable high-impact changes. This framework is designed to serve as a practical guide for central banks and other public or private entities interested in conducting a study on the costs of day-to-day retail payments in their economies. In order to achieve this objective, the guide suggests a comprehensive methodology that can be used in its entirety, or adopted in module form if a country so chooses. The framework also offers the flexibility to adapt certain elements to the specific conditions of a national retail payments market.

The guide is based on four principles:

  • Applicability – the ultimate purpose is to apply the guide on the ground in order to derive retail payment costs, following the step-by-step process described, in any country.
  • Comparability – the methodology followed for the design of the guide is such that it allows for the comparability of retail payment costs across time, and across countries.
  • Efficiency – the framework allows for the identification of the most cost efficient payment instruments, and for the estimation of savings in the migration from paper-based to electronic payment instruments.
  • Standardization – common and internationally recognized terminology in the context of retail payments has been used in order to ensure external validity and further reinforce comparability.

The framework takes into consideration the relevant cost determinants for retail payments:

  • Stakeholder – demand side (consumers, businesses, government agencies) and supply side (payment service and payment infrastructure providers).
  • Payment Instrument – the guide examines 10 payment instruments, paper-based (including cash) and electronic.
  • Transmission Method – how a payment is initiated/received (in-person versus remotely).
  • Payment Purpose – the reason/need that triggers the transaction.
  • Payment Type – the stakeholders involved in the transaction and the identification of the payer and the payee.

Analyzing the combination of all these cost determinants enables the identification and measurement of the relevant cost elements, and a series of important results can be derived from the implementation of the guide.

Consultation Process
Consultation Phase
Timeframe: Mon, 11/23/2015 to Mon, 02/15/2016

Comments are invited from any interested parties and should be submitted by February 15, 2016. 

A final version of the practical guide will then be issued.

Comments should be sent to the World Bank Group ([email protected]). Please mention “Cost Study” in the subject line of your email.


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