Card spending expected to double over the next decade
04 Jul 2013
Credit and debit card spending is expected to nearly double over the next decade as people increasingly rely on their plastic as a convenient way to pay, according to an industry report.
However, according to the UK Cards Association, in the longer term it was also possible to see the "end of the road" for plastic as other methods, including mobile phone payments gain more popularity.
Total card spend in the UK is set to soar from 9.9 billion payments worth £477 billion last year to 17.3 billion payments valued at over £840 billion in 2022, according to the projection of the trade body.
According to the association, over the coming years, most of the growth would come from debit cards, which were first introduced 26 years ago.
With nine in 10 (91 per cent) UK adults holding cards, their numbers worked out to almost 47 million across the country. The number of debit card-holders grew by 1 million compared with 2011, which was in line with growth seen over the last decade.
Innovations in technology would make card use more convenient driving the upswing, thanks to younger people who had grown up with plastic and are in strong habit of using it, the report said.
This included the increasing "tap and go" transactions using contact-less payment technology for low-value items for which people had traditionally used cash.
With contact-less payments people can make payments for goods worth £20 or less with a single swipe of their card on a reader. They are not required to key in a pin number.
The number of debit and credit cards enabled to make contact-less payments rose by 38 per cent in 2012 to hit an estimated 31 million with major chains such as Superdrug, WH Smith, Marks & Spencer and Greggs as also the Post Office now accepting contact-less payments.
Around 120 contact-less transactions were being made per minute by March this year, a figure expected to rise to 300 transactions a minute by the end of 2013.
According to the UK Plastic Card report, the growth in online spending was also boosting card use, with total online card spending increasing by £5 billion in 2012.
Meanwhile, online debit card spending had now overtaken online credit card spending, with debit card spending totalling £35 billion last year as against £34 billion placed on credit cards.
