Industry, Banking Industry Statistics, Credit Card Statistics, Financial Cards,
Credit Card Industry Analysis, about Credit Card Transactions
Debitcard use for Small Ticket purchases Grows PURCHASE, N.Y. -- Debit cards are gaining in popularity for purchases under $20, making significant inroads into “small-ticket” merchant categories that historically have been the exclusive domain of cash, according to a new MasterCard International attitude and usage study. And convenience stores are among the beneficiaries. According to the findings, users of ATM/debit cards report making debit payments for nearly a third (29%) of all their purchases under $20—a 61% increase since 2001—while this group’s cash payments for the same amount declined by nearly 15%. The study underscores the accelerating displacement of cash as a payment option. Moreover, among users of ATM/debit cards, the MasterCard research confirmed that debit cards are now the most popular payment method for purchases between $20 and $100: In the $20 to $50 category, debit payments account for more than half (55%) of all purchases, a 31% increase since 2001; reported preference for checks and cash declined by 50% and 18%, respectively, during the same period. In the $50 to $100 category, debit payments capture 52% of all purchases, compared with 47% in 2001; check use (12%, compared with 25% in 2001) continues its steady decline, while cash’s share remains unchanged at 9%. Weekly grocery shopping and gasoline purchases are the most common occasions for using a debit card. The MasterCard study also found significant growth in adoption of debit cards for lower-ticket purchases at movie theatres, fast-food restaurants and convenience stores, and at higher-ticket establishments including casual restaurants and doctors’ offices. “Debit’s increasing penetration of purchase categories that were previously the exclusive domain of cash and checks clearly shows that consumers prefer the convenience and flexibility of debit plastic over paper for everyday usage occasions,” said Richard G. Lyons, Jr., senior vice president, Deposit Access Group, MasterCard International. The primary advantage of debit cards is convenience, said 41% of survey respondents. When considering security and ease of use, respondents found debit preferable to cash. One-in-five also stated that debit cards help them control their spending, and half said debit was “better than other payment methods,” including cash and checks. While survey respondents found debit cards to be more secure than cash, they expressed concern that debit cards do not share the same level of fraud protection as credit cards. Similarly, consumers had limited understanding of zeroliability protection. Surprisingly, consumers seemed unaware that they can use their debit cards internationally. “The study indicates a banked consumer’s heightened degree of knowledge regarding debit card functionality and benefits directly correlates to an increased reported incidence of card use,” added Lyons. “Clearly an opportunity exists to do a better job communicating the protections and conveniences debit cards offer, and MasterCard has the programs in place to improve consumer understanding of the debit payment option.” The MasterCard study was conducted in December 2003 in 26 geographically dispersed markets in the U.S. The 750 respondents covered the 18 to 64 age spectrum, split half male/half female, with all participants maintaining a checking or brokerage account, with a linked debit/ATM card. The random sample of respondents yielded statistical testing at the 90% confidence Source: www.cspnet.com | |||
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