Abstract:

This research focuses on the behavior of isolated and competing ‘consumer-to-business’ (C2B) and ‘peer-to-peer’ (P2P) payment systems. Our previous analysis of the isolated payment systems has shown that their behaviour can be analyzed using modifications of the Bass equations. In this paper, this approach is extended to the analysis of the set of two competing systems. There is a fundamental difference in the long-term behavior of C2B systems, which always have competitive solutions, and P2P systems, for which there are no competitive solutions. This conclusion is in agreement with the real practice:  the P2P markets are more oligopolistic than the C2B markets.  The results are illustrated by analytical and numerical solutions for different system parameters.