Online debit card use surpasses credit cardData Insights 10 October 2013
Consumers are increasingly turning to their debit card to make online payments.
2012 marked a landmark for the retail industry, with figures showing that debit card spending by online shoppers surpassed credit card use for the first time.
That is according to a new report from the UK Card Association, which found that debit card spending last year reached £35 billion, while spending on credit cards tipped £34 billion.
This marks a significant shift from the online retail industry in the UK, which is playing an increasingly prominent role in the financial make up of the wider economy.
Indeed, a number of the country’s leading high street retailers have come under significant financial strain from the online sector, with consumers increasingly preferring to turn to the internet for their goods.
In 2007, by contrast, the overall spend on online shopping was £14 billion on debit on debit cards and £20 billion on credit cards, money.com reports.
Total online card spending, meanwhile, rose by £5 billion in 2012, which is equivalent to 15 per cent of total spending.
More specifically, research shows that some 73 per cent of all retail spending that takes place on the high street is made using cards.
What’s more, individual debit cardholders made an average of 205 transactions in 2012, a rise of ten such deals on the year before.
The figures have given the UK Card Association good reason to suggest that both credit and debit card usage will increase markedly over the next ten years or so.
The body speculated that the combined total payments in the UK will almost double, rising from £9.9 billion in 2012 to as much as £17.3 billion in 2022.
Consequently, it is anticipated that total values will increase from £477 billion to £840 billion – a figure that serves to underline the untapped potential in the online retail sector.
In June, the Centre for Retail Research claimed that the rise of online shopping could lead to the closure of one in five high street stores by 2018.