• Total UK spending on cards, cash and cheques predicted to reach £51.6 billion during December
• Plastic card spend continues to dominate at 61.6 per cent of overall forecasted spending
• Debit card spending expected to rise 20 per cent from December 2005 to over £20 billion

Today (10 November 2006) APACS, the UK payments association, issued December spending predictions which show that a total of £51.6 billion is expected to be spent over the month, an increase of 6.6 per cent per cent on December 2005 figure of £48.4 billion. 

The combined figures of spending on cards, cash and cheques show a continued increase in plastic card use overall – with cards accounting for 61.6 per cent of the predicted spend of 51.6 billion in December 2006, up from 58.8 per cent in 2005.

The figures released today mirror recent trends with debit cards continuing to dominate as the more popular method of plastic payment and credit card spending levelling off:

• Overall plastic card use looks set to rise.  In December 2005 £28.5 billion was spent on plastic cards, and APACS predicts in December 2006 a rise of 11.6 per cent to £31.8 billion.

• APACS predicts that credit cards will continue to dominate in the online arena, making up 67 per cent of the expected £3 billion total of plastic card spend online at £2 billion, compared to £2.2 billion in 2005. 

• There is a continuing trend to pay by debit cards.  Debit card expenditure in December 2006 is expected to reach £20.4 billion, up £3.4 billion from £17.0 billion in December 2005 (an increase of 20.1 per cent). 

• Credit card spending in December 2006 is predicted to remain close to December 2005 levels at £11.4 billion virtually unchanged from a figure of £11.5 billion in December 2005.

Sandra Quinn, director of communications at APACS, said:

“Overall our penchant for plastic continues, and it looks as though this Christmas our plastic cards will continue to replace cash and cheques for our festive purchases.

“Over recent months we have seen that cardholders are becoming more responsible in the way that they borrow, reining in their spending and focusing on repayments.  It appears that this Christmas is no exception, with the majority of spending being done by debit rather than credit cards.  Debit cards are increasingly replacing cash and cheques for our everyday purchases.  This trend has definitely been helped by chip and PIN which has made paying with plastic faster, safer and more widely accepted all of which means we are more likely to take out our plastic for small value transactions.

“However it is evident that in certain situations, such as Internet shopping, we prefer to use our credit rather than debit cards due to the convenience and security they bring.” 

Table showing actual and predicted spending December 2005 / December 2006

UK consumer spending	December 2005	December 2006 (forecast)	% change
On plastic cards	£28.5 billion	£31.8 billion	+11.6%
On debit cards	£17.0 billion	£20.4 billion	+20.1%
On credit cards	£11.5 billion	£11.4 billion	-0.9%
Combined cash and cheque spending	19.9 billion	£19.8 billion	0%
Total spending (including cash and cheques)	£48.4 billion	£51.6 billion	+6.6%

 

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For further information contact the APACS Cards Information Office:

T: 0870 420 3208 E: apacs@fourcommunications.com

APACS is the UK payments association. It provides the forum for the UK's financial institutions to come together on non-competitive issues, to develop banking systems for the future and to provide innovation and developments in payments. It is also the banking industry voice on payments issues such as plastic cards, payment fraud, cheques, electronic payments and cash and is the banking organisation coordinating chip and PIN roll-out.