Exam - Know characteristics of fee income services (trading revenue, net securitization income, service charges on deposits, investment banking/brokerage services, mutual funds, annuities, trust services, insurance products) and potential benefits and concerns related to the services. Know the multi-card issuer payment system and the three parties in the payments systems and the factors that affect their behavior.  Know the factors that affect the mobile payments systems (focus on stakeholders) and how they affect the systems.

Click on links below for notes on fee income, the card payments systems, and mobile wallet systems.

The following article discusses the recent EU vote (March 2015) to restrict debit card and credit card transaction interchange fees to 0.2% and 0.3%, respectively.  The second article provides examples of different interchange fees in different countries.

The following article describes a 2012 study that demonstrates that cash is still a big part of the U.S. payments system in terms of number of transactions and by young (18-24) people (page 8) and households with lower income (<$25,000) (page 10) while older (>=65) and higher household income (>$200,000) people are much more likely to use credit cards. 

Mobile banking and mobile wallets are also increasing in use.  A summary of the FED's report, Consumers and Mobile Financial Services 2014, can be viewed below.  A short video on that page also summarizes the highlights. 

The lecture notes also describe more aspects of the "mobile wallet."  KNOW the stakeholders and their interests.

Related topics not on exam: 

To see international comparison of cashless payments go to p. 59 (pdf p. 65) in the full report at http://www.bis.org/publ/cpss102.pdf.

For those who may be interested in payment card fraud developments in the U.S. and Europe see the following article www.kansascityfed.org/publicat/econrev/pdf/13q1Sullivan.pdf.