Recently a report stated that consumers’ annual spending on cards has topped £500 billion for the first time across 2013.
The trade body UK Cards Association has found out that debit and credit cards were responsible for three in every four pounds spent in shops. Just 10 years ago, the figures looked different- only two in every four.
The above mentioned report on UK Card Payments found that British people spent £520 billion on UK goods and services using their debit and credit cards last year. Comparing to the same time in 2012, there was only £488 billion spent. Thus, this year’s figures mark a 6.7% increase.
If we add up the spending by overseas visitors as well, we end with £534 billion of total value of purchases on debit and credit cards in 2013. What this means is that spending on cards now comprises one third of the total GDP of the United Kingdom. Again comparing with earlier data, the spending on cards accounted for only one quarter in 2003.
Furthermore, nowadays 91% of UK adults have a debit card which adds up to a total of 47.5million cardholders. In 2012, there was half a million less cardholders. The increase in debit card owners has been mainly due to the fact that in recent years there have appeared many bank accounts on the market which automatically issue a debit card. What is more, around 38% of the debit cards holders have two or more cards.
Further statistics from the report show that over 80% of all credit and charge card spending in 2013 was made by cardholders who repaid the balance in full. From 2005 to 2013, outstanding borrowing on credit cards has fallen by 15.6%. in 2005, the monthly average of outstanding borrowing was £67.4 billion, while in 2013 it was £56.4 billion. This reflects the desire of people to pay down debt where possible even in tough economic times.
Future expectations are that the annual value of card payments will be lifted from £520 billion last year to around £874 billion in 2023. It is expected that young adults will boost this figure because they have been used to debit cards while they were growing up. The growth in technology will also account for some of these changes, because contactless payments are introduced every day, plus there is a constant rise in internet shopping which often includes payments being made by debit cards.