Use of debit cards gains momentum

Debit cards continue to gain market share from credit cards, and the use of electronic and mobile payments continues to show exponential growth, according to the World Payments Report (WPR1) 2012.

The report released  by Capgemini, RBS, and Efma highlighted that the relationship between regulation and innovation, with some regulation challenging innovation; and the fact that the BRIC (Brazil, Russia, India, China) concept is no longer valid in payments, with Brazil now the second-highest ranking country by payment volumes after the US.

There were 20 billion non-cash transactions in Brazil in 2010, compared with 13.1 billion in Russia, India and China combined. The report confirms the resilience of payment volumes, as global non-cash payments volumes grew by 7.1% in 2010, reaching 283 billion, although early 2011 indications show an additional 8.2% growth.

In 2010, payment volumes in developing markets grew at a much faster rate (16.9%), boosted by a more than 30% increase in both Russia and China.
 
As more consumers embrace electronic, mobile and debit card payments, industry innovation will continue to focus heavily on these payment methods, the report said.

According to industry analysts, there were an estimated 28.3 billion electronic and mobile payment transactions globally in 2011, and in 2010 more than one in three non-cash payments globally were made using a debit card, up 15.2%, according to the report.

But with only 2.1% of all mobile users making m-payments, the potential for additional growth is still huge, with mobile payments set to reach 17 billion by 2013 and e-payments 31.4 billion by 2013.

“Debit card transactions continue to take market share from other types of payment methods because they easily allow people to bypass the use of cash. As more and more consumers move to mobile and other electronic payments, we'll continue to see the exponential growth of innovative payment solutions,” said Kevin Brown, Global Head, Transaction Services Product, International Banking, RBS.