Card use extending to smaller purchases as contactless catches on
Growth in the volume of debit and credit card purchases in the UK continues to outstrip the growth in value as consumers use their cards more frequently for lower value payments. A threefold increase in contactless payments was a factor in the trend.
According to the latest figures from The UK Cards Association, the number of purchases grew 9.2% year-on-year in June, reaching 993 million in the month. In the same period, total spending on debit and credit cards increased at the lower rate of 7.2%, totalling £47.0 billion.
This means the average transaction value on a payment card has fallen by £1.40 over the last year, down from £48.91 to £47.51 in June 2014. The average debit card transaction is now £43.70 and for credit cards it is £60.13.
“We’ve seen the average value of a card transaction drop over the last year as consumers increasingly choose to use their cards to pay for smaller purchases,” said Richard Koch, head of policy at the association. “In the retail sector, the average shop is now less than £34 – an increase in small transactions online and the use of contactless cards for lower, everyday sums is partly behind this significant trend.”
The number of monthly contactless transactions has more than tripled in the last year, with consumers spending £146.1 million using their contactless cards in May 2014. The average contactless transaction is £6.60.
Monthly debit card spending (£33.2 billion in June) continues to grow faster than credit card spending (£13.8 billion) – both up by 8.2% and 5.0% respectively.
The biggest increases in total card spending between May and June were recorded in the purchase of financial products and services (up 37%), and at employment agencies (up 30%).
| Spending figures for June |
Total Spending £ billions |
Annual growth rates for spending |
Number of purchases Millions |
|||
|
2014 |
2013 |
2014 |
2013 |
2014 |
2013 |
|
| All cards |
47.0 |
44.4 |
7.2% |
4.6% |
993 |
910 |
| Debit cards |
33.2 |
31.1 |
8.2% |
6.0% |
763 |
697 |
| Credit cards |
13.8 |
13.3 |
5.0% |
1.5% |
260 |
213 |
