Dollar volume spent on debit cards in the U.S. rose by 14% as a result of generous government benefits and a change in consumers' payment preferences that shifted away from checks, cash, and credit cards. This and other aspects of the current market for debit cards are reviewed in this report.
"This past year the market experienced a unique environment where consumers sharply shifted their payments towards the use of debit cards and because some of this shift came at the expense of credit cards, this was positive for debit issuers and, at the same time, positive for merchants as credit card transactions are nearly always more expensive to process than debit cards. Issuers are interested in encouraging the continued top-of-wallet position that debit cards have achieved, but competition from fintechs plus likely regulatory changes will make this an uphill battle," comments Sarah Grotta, Director, Debit and Alternative Products Advisory Service and author of the report.
Highlights of the report include:
Historic look at debit card purchase volumes and transaction totals for 2015-2020
Comparison of debit's growth with the recent decline of credit card use
The continued growth of card accounts driven in part by neo and challenger banks
The growth of card-not-present activity
Commentary on the use of contactless
A three-year forecast of debit's projected growth and the near-term influences that affect the forecast
Where issuers are focusing their current investments in debit.