Shift to electronic payment culture: Visa

CONSUMERS in Ireland are increasingly shifting towards an electronic payment culture, new figures suggest.

Card issuer Visa — which now calls itself a payments technology company — has reported the amount that Irish consumers spent a total of €13 billion on transactions using its various products in 2011.

This represents an increase of 48% when compared to 2010 data.

This, however, was not simplya case of more people piling everything onto their credit cards in recessionary times, but rather was spread across Visa’s range of credit, debit and pre-paid card products, an example of the latter being O2’s money card.

As Permanent TSB and Ulster Bank are the only Irish banks issuing Visa debit cards (Bank of Ireland and AIB are both set to switch over from Laser in the coming months), Visa will not break down transaction data between credit, debit and pre-paid cards on competitive confidentiality grounds.

However, on a Europewide basis, nearly 80% of Visa product spend is on debit cards.

“Despite the continuing economic challenges, spending on Visa cards by Europeans grew by 14% in 2011 as more consumers and retailers recognised the convenience, security and efficiency of electronic payments,” said Peter Ayliffe, Visa Europe chief executive.

“The strongest growth, once again, was on debit cards.”

Conor Langford, vice-president of Visa Ireland, added that the number of Visa cards in use in the Irish market — across each profile — increased by 28% last year. The consumer spend figure is likely to increase here during this year, he said.

While acknowledging that not all of the increase can be attributed to credit card abuse, the Consumer Association of Ireland (CAI), nevertheless warned against the dangers that could lie ahead for card users.

“We have, admittedly, seen a decline in credit card-related calls or complaints, and the most recent trends are of people generally reducing their credit card spend and eliminating the associated debt,” said Dermott Jewell, chief executive of CAI.

“If we’re talking about smart card usage — where people are making ends meet until pay day — then [that is] excellent. But if that’s the case it would represent a near 100% turnaround in card management habits.

“If there are rising instances where people are using their cards to facilitate debts they can’t meet, this would be a worry and could spell significant concerns for the future,” he added.

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