Credit Card Facts
Anyone over a certain age will remember a bygone era when credit cards were not the mainstream financial product that they are today. Now, not only are they an accepted way to pay for any number of purchases or services they can also assist the user in managing their finances.
More from Understanding Credit Cards
29 December 2008
Credit card facts
The first credit card to be launched on the market was Diners Club in 1951 in the USA.”
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Did you know that the first credit card to be launched on the market was Diners Club in 1951 in the USA? It was accepted in 27 New York restaurants. At first, only 200 cards were issued.
Diners Club was followed by Carte Blanche and in 1958 American Express, which created a worldwide credit card network.
Fast-forward to the sixties and Barclays issued Barclaycard, the UK’s first general credit card.
The UK market today
Last year there were 67.3 million credit cards in issue.
The number of personal credit and charge cardholders fell to 30.8 million, representing 62% of the population.
The average number of cards per person was 2.4 credit cards.
Spending on plastic cards in the UK amounted to £354.2 billion in 2007, with £133.2 billion spent on credit and charge cards.
Internet card payments have risen nearly four-fold over the last five years, to £34 billion. This figure includes all plastic – credit and debit.
There were 1.9 billion purchases made on credit and charge cards in the UK, giving an average transaction value of £63.22.
Card fraud facts and figures
In 2007, total card fraud losses increased by 25% to £535 million.
Although card fraud levels have increased, due to fraud abroad and card-not-present fraud losses, chip and PIN has proven to be an undoubted success in reducing card fraud on the UK high street. This type of fraud is down by 67% from £218.8 million in 2004 to £73 million last year.
Mail non-receipt fraud also fell, dropping 34%, and lost and stolen card fraud showed an overall year-on-year decrease of 18%.
In 2007, counterfeit card fraud increased by 46% to £144.3 million. However, the main area of card fraud was phone, internet and mail order (card-not-present or CNP) fraud, which was up by 37% last year, totalling £290.5 million. This type of fraud accounts for more than half of all card fraud losses.
Facts supplied by APACS, the UK payments association.
More choice for the consumer
APACS comment on how the British flex their plastic:
“Spending on credit cards has been fairly flat over the past four years following several years of steady increases.
This is mirrored by the number of credit cards in issue, which increased from 35 million in 1997 to 66.8 million by 2003, but had only risen to 67.3 million as of last year. In fact, the number of credit cards in issue actually fell by 2.2 million between 2006 and 2007.
"There has been virtually no change in the average monthly amount of spending on credit cards since the end of 2004. In December 2004 monthly spending averaged £10.1 billion and this figure increased to only £10.3 billion by the end of 2007.
"Over the same three-year period the average monthly number of credit card purchases fell from 165.8 million to 163.3 million, indicating that to a small extent cardholders were cutting back on their card use. By 2007 spending on credit cards accounted for 35.6% of all plastic card spending compared with 44.8% in 2004 – showing that spending on debit cards was becoming more popular.
"Overall it is expected that the low growth seen in recent years in personal credit card usage will persist into the medium term, and beyond that growth will pick up in tune with the economic cycle.
"Personal credit card payment volumes in the UK are expected to grow to 2.6 billion in 2017, from 1.8 billion in 2007. Personal credit card spending will be around £173 billion in ten years’ time, compared with £110 billion in 2007.”
