MAY 2004

Visa Debit Exceeds Credit Volume

The American Banker reports that in 2003, for the first time ever, cardholders worldwide spent more with Visa debit cards than with Visa credit cards. Visa’s global debit card volume in 2003 reached $1.48 trillion, up 17%. By comparison, Visa credit card totaled $1.45 trillion, up 5% from the year before. Purchases account for 52% of all debit card volume with the remaining transactions attributable to cash withdrawals. In terms of the number of transactions, Visa debit cards accounted for 24.4 billion debit card transactions and 15.2 billion credit card transactions in 2003.

The story in the United States is a bit different. The credit card is still king in terms of the dollar volume of transactions. U.S. Visa credit card charge volume was $649.7 billion, compared to $489.5 billion for debit, including cash withdrawals. Gaylon Howe, EVP of consumer product platforms at Visa International, told the American Banker that debit card volume has grown faster overseas than in the U.S. because "the checking account is the starting point" in markets where few consumers can qualify for a credit card. Unlike a generation ago in the U.S., in most overseas markets the debit card is the consumer’s introduction to plastic.