History of Debit Cards in Australia ~ Debit Cards Australia

Debit Cards date back to about the date of the introduction of e-commerce. The first ‘Switch card’ transaction took place in 1988. By 1995, Debit Cards had overtaken credit cards in popularity, and by 1998 Debit Card transactions were more common than cheque payments.

In 1990 there were already over 19 million Debit Cards in circulation. Rapid growth continued through to 2006, when circulation reached 27.8 million. Although growth has slowed a little because of the market reaching saturation point, it is expected that 34.4 million cards will be in circulation by 2016.

The most significant driver of growth in the Debit Card market was the advent of ‘chip and PIN’ technology, reducing the scope for fraud.

Visa say the Debit Cards are the fastest growing consumer product ever released by their company, with over 115 million people carrying a Visa-branded debit card and about 70 million people using their card every month! By 2005, Debit Cards were used an average of 166 times per user annually.

In the US, 82% of bank account holders have an ATM debit card. Worldwide, it is estimated that seven out of ten consumer households now have a Debit Card, and 53% of households use their card to make retail purchases monthly. On average, consumers use their Debit Card nineteen times each month. Figures released in the UK show that 109 billion pounds was spend using debit cards in 2007, compared to only 84 billion pounds cash and a measly 7.4 billion pounds using cheques.

In Australia, EFTPOS-enabled cards have been operating since the 1980s, and are now accepted at most swipe terminals that accept credit cards.

June 2008 surveys revealed 13 million credit cards on issue in Australia, and 28 million debit cards. The Commonwealth Bank is the largest issuer of debit cards, topping $10 billion in purchase volume.

With more than 20 billion transactions of less than $10 value now made yearly using plastic cards, we may be close to the point where cash will follow cheques into oblivion. The popularity of Debit Cards, combined with rising global concern about credit card debt, might well see the Debit Card become the global standard of payment.

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