Electronic Payment and Economic Growth in Indonesia

Electronic Payment Economic Growth Vector Error Correction Model (VECM)


November 25, 2021


The purpose of this study is to investigate the effect of non-cash payment transactions on economic growth in Indonesia and to see the responses from supporting variables, such as the velocity of money and the price of transactions. This study involves a Vector Error Correction Model (VECM) analysis tool, using monthly time series data during 2009: 1 – 2017: 12. The results show that the payment instrument affects economic growth, especially the Card-Based Payment Instrument (CBPI). In addition, there are changes to the velocity of money and prices caused by the increase in the use of non-cash payment instruments. 

Keywords: Electronic Payment, Economic Growth, Vector Error Correction Model (VECM)
JEL: E4; C51

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