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At Payments Cards & Mobile we have long been supporters of a role for payment cards in the overall payments mix, thanks to our own Payment Yearbooks which show card use continuing to grow, even as new payment methods such as instant account-to-account payments, BNPL and others take hold.
Now independent research from RBR has corroborated our view, showing that credit and debit cards enjoyed the lion’s share of new growth in spending outside China in every region of the world.
While overall growth in payment values of just 1% world-wide might sound modest, it needs to be seen in the context of digital wallets being used for almost nine in ten payments by Chinese consumers.
Strip out the figures for China, and global card growth looks a lot more promising, especially in certain regions and verticals.
Even though card use declined in China – and faces an uphill battle in India, Thailand, Malaysia and other Asian markets – the emerging markets of the Middle East and Africa saw card transactions grow by a fifth.
In particular, prepaid cards have become a popular means of drawing consumers into the formal financial system from the cash economy, with prepaid cards used for everyday purchases in fast-growing African markets.
For Europe and America, the return to leisure travel has seen consumers more likely to use cards as a payment instrument, with card spending up 10% on average between the two regions.
Cross-border e-commerce using cards as a method was also up strongly in these developed markets.
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During the pandemic, Visa published a study claiming that seven in ten US consumers preferred cards as a payment method because they were trusted and familiar.
As the world recovers, it seems cards continued to be preferred in most regions outside Asia – with the caveat that digital wallets are gaining ground fast in Europe.
Issuing banks in particular would be well advised to continue with cards at the core of their payments strategy – and in particular to consider how they can think differently about card programmes in the digital era.
Whether that’s using cards to secure e-commerce via tap-to-phone systems, enhancing the security of cards through biometric factors, or allowing consumers to manage their cards via app.
Don’t believe the hype – cards are going to be around for a lot longer than many people think.
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