Debit Cards Rule the Roost At The Till

Consumers in the UK are turning to their debit card instead of cash when it comes to paying for purchases on the high street as well as online.

Figures released by APACS (the Association of Payment Clearing Services) revealed that in 2005 the use of debit cards exceeded that of cash for the first time.

The figures also revealed that retail spending in the UK in 2005 using debit cards rose by 9% to £89bn. This figure accounted for 37% of retail spending last year.

Meanwhile, during the same period cash spending dropped by 4% to £81bn, with credit card spending remaining unchanged at £61bn.

The humble cheque faired even worse with its use continuing to dwindle with only £9bn worth being written in stores last year.

When it comes to paying for transactions in shops and online, consumers in the UK appear to now prefer the use plastic above any other payment method.

Sandra Quinn, director of communications at APACS, feels that many consumers and stores have now formed a daily habit of using plastic, rather than cash, to pay for goods and services, no matter how small the item.

“ At the end of 2004, we saw total UK spending on plastic overtake cash for the first time, signalling a real sea change in our payment habits.

“ This change was mainly driven by debit card use. The 2005 figures show that this trend is continuing with debit card spending in retail outlets crashing through the crash barrier for the first time ever,” she added.

The figures released by APACS are conclusive proof that the popularity of debit cards in the UK is at its highest ever level. It now appears that UK consumers prefer the convenience and added security that cards, especially Chip- and- Pin, offer, over cash.

Since their introduction 20 years ago, debit cards have steadily overtaken not only cheques but also credit cards – and in some cases – even cash.

However, this news does not sound the death knell for cash as despite its dwindling popularity in the shops, it is still widely used elsewhere.

It is still the most popular method of payment when it comes to paying for items such as transport tickets or cinema tickets, for example.

For such items, cash accounted for £192bn spent in this way, compared with £145bn using plastic.

Alisdair Milton
17/4/06

 

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