Payments industry publishes 2008 spending data

• Plastic cards accounted for 66% of all UK retail spending last year
  
• Debit cards accounted for two thirds of all retail spending on cards 
  
• Cheque usage on the high street continued to decline and spending fell by 4%

Figures released today (28 April 2009) by the UK payments industry give an authoritative overview of UK consumers’ spending habits last year. These latest figures show that 2008 followed the key trends seen over recent years with cash and credit card spending remaining comparatively flat, cheque use falling and spending on debit card and electronic payments continuing to rise. In particular last year, the growth of debit card spending at retailers remained strong with spending rising by 6.8%: debit cards now account for two-thirds of spending on plastic cards.

The retail spending statistics in table 1, which cover all online and offline retail transactions in 2008, show that of a total £269.9bn spent by consumers, 43 per cent (£116.1bn) was by debit card, 32 per cent (£86bn) was by cash, 23 per cent (£60.7bn) was by credit card and only 3 per cent (£7.1bn) was by cheque.

Total consumer spending statistics for the UK (see Table 2), also released today,  show that for general consumer spending - which includes financial payments and payments for travel and entertainment among others - debit card and automated payment use also grew strongly between 2007 and 2008. Last year, debit card spending grew by 9.5% to reach £245 billion, and automated payments by 6.9% to reach £333 billion. That year, cheques accounted for less than three quarters the amount spent by UK consumers on their debit cards.   

Sandra Quinn, director of communications says:

“Despite what started to happen across the economy last year these latest figures don’t reveal any marked changes from the annual trends we’ve seen over the past few years. Most notably consumers are increasingly choosing to use their debit cards in preference to cash or cheques and also, it seems, their credit cards.

“The rise to dominance of the debit card both on and off the high street has been meteoric – it was only back in December 2004 that combined total credit and debit card spending overtook total cash spending for the first time. This year we expect debit card spending alone will outstrip cash spending for the first time.”

ENDS

For further information contact the press office on 020 7711 6316 or press@ukpayments.org.uk

Notes to editors:

1 *UK retail spending includes all transactions on the high street and online for example in  supermarkets, clothing and furniture shops, chemists, newsagents and electrical and DIY shops.

2. **Total UK consumer spending includes all transactions on the high street and online to retailers and for other purposes such as for fuel, travel and entertainment and financial payments, which includes repayments on loans and savings and investments.

3 Each year the payments industry publishes UK Consumer Payments - a unique report that tracks how UK consumers spend their money. It is based on findings from the Consumer Payments Survey and covers topics such as current account holding, how often we withdraw cash, how we receive our wages, how we shop on the internet and how we acquire cash. To find out more information, or to purchase this publication, please contact press@ukpayments.org.uk