Global Balance Tips to Card Payments over Cash in 2016
Global consumer card payments will surpass cash payments for the first time this year, reaching $23.1 trillion worldwide, according to new data from Euromonitor International. Cash transactions are projected at $22.6 trillion for the year, according to the research firm. Global consumer card spend for 2016 will increase $1.8 trillion over 2015—and is projected to grow an average of 6.6 percent annually until 2021, Euromonitor said. Debit cards are expected to drive much of that growth; the number of debit cards in circulation worldwide jumped 8.1 percent from 2015 to 2016, compared to a 5.3 percent increase for credit cards in circulation—and debit card circulation will increase by 7.4 percent per year until 2021, according to the data. Debit growth is especially strong in China, where there are more than 5.4 billion debit cards in circulation and 65 percent of card payments are made on a debit card.
Euromonitor also predicts robust growth in the global mobile commerce vertical, projecting mobile spending to surge by 53 percent this year compared to 2015. Over the next five years, overall spend on mobile devices will increase by 23 percent annually from 2016 to 2021, the firm estimates.
Cash spending will increase too—though at a much lower rate than card payments, at 1.3 percent annually. “This stagnant growth of cash payments signals a shift from an increase of cash supply to a decrease and is a major victory for card and electronic payments,” said Kendrick Sands, senior consumer finance analyst at Euromonitor. “Overall, continued strong momentum is expected in the conversion of consumer payments away from paper to card and electronic alternatives.”