Payment Instruments: Card Payments

According to the Bank for International Settlements, card-based payment products are electronic money products which provide the customer with a portable, specialised computer device, typically an integrated circuit card containing a microprocessor chip.

By Denise Bedell

Use Of Card Payments By Non-Banks (number of transactions (millions, total for the year)):

Card payments total (except e-money)

Use Of Card Payments By Non-Banks (value of transactions (US$ billions, total for the year)):

Card payments total (except e-money)

Data is from the Bank for International Settlements' Committee on Payments and Settlement Systems (CPSS) Annual Payments Statistics, March 2011.

Use Of Card Payments By Non-Banks (number of transactions (millions, total for the year))

*Different methodology and data collection method since reporting year 2007.

**Sum or average excluding those countries for which data are not available.

Use Of Card Payments By Non-Banks (value of transactions (US$ billions, total for the year))

*Different methodology and data collection method since reporting year 2007.

**Sum or average excluding those countries for which data are not available.

The use of cards as a payment mechanism encompasses any type of payment involving a chip card, including those with debit and/or credit functions. For the purposes of the data gathered by the Bank for International Settlements (BIS) and cited here, it does not include e-money – where the value or cash-equivalent is held electronically but not disbursed through the use of a chip card. It includes cards with a debit function, cards with a credit function, cards with both a credit and debit function, and cards with a delayed debit function.

A delayed debit occurs when the card provider debits the account bi-monthly or monthly, rather than immediately upon purchase, as with regular debit cards. It allows the user to earn interest on their balances over the course of the month and have all expenses debited at one time. It was traditionally a feature of some corporate card programs, but has since grown in popularity for individual card holders, as well, in some markets.

However, delayed debit cards still account for a just a fraction of the total card market, as credit and regular debit cards dominate most CPSS markets.

According to data from the BIS Committee on Payment and Settlement Systems (CPSS), overall card use grew steadily in all reporting CPSS countries between 2005 and 2009, aside from some minor declines during the financial crisis.

By relative importance as a non-bank payment mechanism, cards are most significant in Saudi Arabia, where they made up 11.7% of overall payments volumes in 2009.

In a number of markets, card use by number of transactions grew rapidly between 2005 and 2009. In particular, in India card use more than tripled from 1.1 billion transactions in 2005 to a staggering 3.8 billion transactions by 2009, and in Korea it went from 2.7 billion card transactions in 2005 to 5.8 billion in 2009.

The largest market for card use, both by number of transactions and by total value of transactions, is the United States. It reported 60.87 billion card transactions in 2009 with a total value of $3.39 trillion. Of these, around 38 billion involved a debit transaction while about 22 billion involved credit. The US did not report figures for delayed debit card transactions. Canada, France and the UK also reported strong overall card use figures, although France did not submit figures breaking down card use by debit and credit functions.

The UK and Canada are big users of debit cards by number of transaction, while Brazil and Korea were big users of cards with a credit function in 2009.

The UK-one of only five countries reporting delayed debit figures-had the highest value of total delayed debit transactions in 2009, at $57.5 billion – down from $73.4 billion in 2008. However Germany reported a greater number of delayed debit transactions, at 360.5 million transactions to the UK's 166 million.