Plastic spending hits €7.6bn

IRISH people are splashing out more on their credit cards with €7.6 billion spent so far this year, an increase on the €6.9bn spent in 2002.

New figures show the number of cards in issue has remained flat at 1.8 million, while the average value of each transaction has dropped from €92 to €88.

But cards are being used more, an average of 47 times per year, bringing the total number of credit transactions in Ireland to 86 million. This is up 14% on the 75 million transactions in 2002.

According to the Irish Bankers Federation annual facts and figure guide there has also been an increase in the use of Laser cards, up 27% to 55 million transactions a year, worth €3.3bn.

The boom in credit card use may heighten fears that Irish consumers are overspending and getting themselves in debt.

However, the credit card figures do not give a breakdown of retail spending and payments.

The IBF said it welcomed the increased use of credit and debit cards to make payments and said the continued dependency on the use of cash in Ireland needed to be tackled as it was more expensive for consumers and the economy.

The IBF also said the country has a higher number of bank branches per million people than Britain with 266 branches per million compared to 252 in Britain and 226 in Sweden. The number of bank branches across the country stayed the same as 2002 with 856 branches.

The IBF claimed that Irish banking charges remain low by international standards and that many of the charges, such as for ATM transactions, are absorbed by the banks themselves. It added that the bulk of recent fee increases was due to Government-imposed charges.

The IBF calculated the average customer pays €70 a year in tax for banking services. It said in the past decade charges have risen by as little at 3.1%, compared to a 29% rise in cumulative inflation.

The IBF found banking is a major source of revenue to the Exchequer, paying €1.3bn in taxes and a further €3.7bn through wages and other investments.

The sector added 4,500 jobs in 2002. The bulk of employment is in the clearing banks AIB, Bank of Ireland, permanent tsb , Ulster Bank and NIB though the non-clearing banks are seeing a rapid rise in employment numbers.

IBF president Diarmuid Bradley said: "These figures demonstrate the success of the banking industry in generating employment and in making a hugely important contribution to the well-being of the Irish economy and society."