UK: 62% of Card Spending, 72% of Card Transactions on Debit Cards
APACS has announced that £354 billion was spent on plastic cards in the UK in 2007 - a 10 percent increase over 2006 - and that spending of debit cards accounted for 62 per cent of total plastic card spend and 72 percent of total plastic card transactions. Debit cards were used to make 4.9 billion purchases in the UK while credit and charge cards were used to make 1.9 billion purchases. Credit card credit outstanding in the UK fell by £1.1 billion during 2007.
Sandra Quinn, director of communications at APACS, said: “Over the past 3 years we’ve seen a pattern emerge: debit cards have increasingly become consumers’ first choice over other options, such as cash, cheques and credit cards. And whilst these figures are for last year, surprisingly despite lots of speculation, all the early indications from our figures so far for this year show that there has been no sudden spike in credit card spending. In fact, credit card spending up until the end of May increased by only 1.2% – below the rate of inflation, and the average value of a credit card purchase in a supermarket has actually fallen by £1 to £34.33.
“Interestingly the report also shows that last year debit cards even gained ground in areas where credit cards have traditionally had a firm hold – particularly on the internet. We would, however, continue to remind customers that because of the additional consumer protection benefits credit cards provide, you may find a credit card to be a more sensible choice online.”
The £354 billion spent on plastic cards during 2007 equated to 31% of total consumer spending in the UK, with the remaining £771 billion made up of cash, automated payments and cheques.
Debit cards were used to make 4.9 billion purchases in the UK, and by 2017 it is projected that there will be around nine billion debit card payments. Over the last decade debit card spending has increased five fold from £45 billion in 1997. This upward trend is expected to continue, by 2010 personal spending by debit card is expected to overtake personal spending by cash, and by 2017 it’s expected to reach £469 billion.
During 2007 credit and charge cards were used to make 1.9 billion purchases in the UK to a value of £133 billion – an increase of 6% per cent on 2006 figures. This rise in credit card spending did not lead to any increase in borrowing as the amount of credit card credit outstanding fell by £1.1 billion during 2007.
For information on how to order a copy of The Way We Pay 2008: UK Plastic Cards and details of other APACS publications available to purchase, please visit http://www.apacs.org.uk/publications.html.
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