Gauging the Impact of Payment System Innovations on Financial Intermediation: Novel Empirical Evidence from Indonesia

IF 1.2 Q3 BUSINESS, FINANCE

Journal of Emerging Market Finance Pub Date : 2019-06-18 DOI:10.1177/0972652719846312

Alexander Lubis, Constantinos Alexiou, J. Nellis

{"title":"Gauging the Impact of Payment System Innovations on Financial Intermediation: Novel Empirical Evidence from Indonesia","authors":"Alexander Lubis, Constantinos Alexiou, J. Nellis","doi":"10.1177/0972652719846312","DOIUrl":null,"url":null,"abstract":"In this article, the relationship between innovations in the payment systems and financial intermediation is explored. By focusing on excess reserves and currency demand we provide evidence on the extant transmission mechanism. In this direction, a generalised method of moments (GMM) and vector error correction model (VECM) techniques are applied to a data set collated for Indonesia. We find that financial intermediation is affected by currency demand while we observe a limited role of excess reserves affecting financial intermediation. Credit card payments are found to have a statistically significant effect on currency demand, whereas debit card payments only influence financial intermediation in the long run. In addition, the real-time gross settlement (RTGS) exerts an upward pressure on excess reserves. The findings are of great importance as they provide support to policies that favour payment migration to an electronic platform, particularly that of card-based payment systems. JEL Classification: E42, E58, N25, G21","PeriodicalId":44100,"journal":{"name":"Journal of Emerging Market Finance","volume":"18 1","pages":"290 - 338"},"PeriodicalIF":1.2000,"publicationDate":"2019-06-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1177/0972652719846312","citationCount":"1","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of Emerging Market Finance","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1177/0972652719846312","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q3","JCRName":"BUSINESS, FINANCE","Score":null,"Total":0}

引用次数: 1

Abstract

In this article, the relationship between innovations in the payment systems and financial intermediation is explored. By focusing on excess reserves and currency demand we provide evidence on the extant transmission mechanism. In this direction, a generalised method of moments (GMM) and vector error correction model (VECM) techniques are applied to a data set collated for Indonesia. We find that financial intermediation is affected by currency demand while we observe a limited role of excess reserves affecting financial intermediation. Credit card payments are found to have a statistically significant effect on currency demand, whereas debit card payments only influence financial intermediation in the long run. In addition, the real-time gross settlement (RTGS) exerts an upward pressure on excess reserves. The findings are of great importance as they provide support to policies that favour payment migration to an electronic platform, particularly that of card-based payment systems. JEL Classification: E42, E58, N25, G21

查看原文本刊更多论文

衡量支付系统创新对金融中介的影响:来自印度尼西亚的新经验证据

本文探讨了支付系统创新与金融中介之间的关系。通过关注超额储备和货币需求，我们为现有的传导机制提供了证据。在这个方向上，将广义矩量法(GMM)和矢量误差修正模型(VECM)技术应用于印度尼西亚整理的数据集。我们发现，金融中介受到货币需求的影响，而超额准备金对金融中介的影响作用有限。信用卡支付被发现对货币需求有统计上显著的影响，而借记卡支付仅在长期内影响金融中介。此外，实时全额结算(RTGS)对超额准备金施加了上行压力。这些发现非常重要，因为它们为有利于支付向电子平台迁移的政策提供了支持，特别是基于卡的支付系统。JEL分类:E42, E58, N25, G21

本文章由计算机程序翻译，如有差异，请以英文原文为准。

求助全文

约1分钟内获得全文求助全文

来源期刊

Journal of Emerging Market Finance BUSINESS, FINANCE-

CiteScore

1.80

自引率

33.30%

发文量

期刊介绍： The Journal of Emerging Market Finance is a forum for debate and discussion on the theory and practice of finance in emerging markets. While the emphasis is on articles that are of practical significance, the journal also covers theoretical and conceptual aspects relating to emerging financial markets. Peer-reviewed, the journal is equally useful to practitioners and to banking and investment companies as to scholars.