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UK Plastic Cards: Outlook to 2012
Datamonitor, May 2011, Pages: 53
Introduction
In 2010, economic uncertainty contributed to plummeting consumer confidence and expectations, which in turn made potential borrowers hesitant about using credit cards. Alongside the clear impacts of the recession, the sector has been faced with both the worsening of old problems and the arrival of a new range of issues that were unexpected by many.
Features and benefits
- Includes detailed analysis of macro-economic indicators and how these factors will affect the card market through to 2012.
- Providing the latest data, the report focuses on key metrics such as card transaction values, balances, and card numbers.
- Includes detailed analysis of EU and UK regulatory changes, their impacts on issuers and consumers, and how issuers should adapt.
- By using the latest available market data the report offers in-depth analysis of likely forecast scenarios through to 2012.
Highlights
Stagflation and high unemployment have led to falling consumer confidence. The economy contracted again in Q4 2010, increasing fears of further unemployment making consumers think twice about using credit cards. Historically low interest rates means consumers are taking the opportunity to pay off debt rather than save or spend on credit.
In Q2 2010, the growth in card write-offs peaked at an all-time high of 163.3%; however, with a fall in growth for insolvencies and unemployment, card write-offs are expected to fall. However in a volatile environment write-offs may be prone to future rises and falls.
Current economic circumstances have exacerbated long-term cards trends. Debit transaction values are growing twice as fast as credit, which have remained relatively flat. Whereas debit card transaction values have grown year-on-year, credit cards have alternated between shrinkage and growth.
Your key questions answered
- How is the UK recovering from recession? How has the cards market changed as a result?
- What impact will new regulation have on consumers and issuers?
- What are the key drivers impacting growth through to 2012?
- How have card balances, write-offs, and transaction values changed since the worst of the recession?
- How will the card market perform in 2011 and 2012?
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