OREANDA-NEWS. In December 2015, total transactions on debit cards peaked at nearly €4.5 billion, reflecting increased expenditure over the Christmas period. Almost €2.8 billion of this spending was attributable to Point of Sale (PoS) activity, while the remaining €1.7 billion was accounted for by ATM transactions (Chart 1).  In the same month, PoS spending on all credit cards amounted to circa €984 million. More recently, debit card transactions have declined to just over €3.7 billion.

Debit card e-commerce expenditure has generally trended upward since February 2015.  Debit card e-commerce has risen by 45 per cent over the year, to stand at nearly €719 million at end-February 2016.  In contrast, total credit card e-commerce has been relatively stable over the same period, increasing by just 7 per cent to circa €291 million at end-February 2016.

Approximately €1.2 billion of outstanding credit card balances included an accrued interest component. Chart 3 provides a breakdown of interest-bearing balances as a percentage of credit card limits. This shows that 9 per cent of cards have exceeded their credit limit while 37 per cent had balances between 76 and 100 per cent of their respective credit limit. This proportion has remained virtually unchanged over the past year, although there has been a small decline in the number of personal credit cards in issue during the same period.

In terms of sectoral spending, the value of new PoS debit card spending per month was over two and a half times greater for debit cards than for credit cards at end-February 2016.  Credit card expenditure remained stable, averaging almost €870 million over the year ending February 2016. During the same period, PoS spending on debit cards increased by circa €525 million, to stand at nearly €2.3 billion (Table 1).    The majority of debit card expenditure occurs in the retail sector, where transactions valued over €1.1 billion were recorded in February 2016.

Total debit card expenditure outside Ireland averaged just under €270 million over the 12 month period to end-February 2016 (Chart 4). Credit or debit card expenditure outside Ireland (when the physical card is present), provides an indication of the volume of tourism abroad vis-?-vis Irish residents. Debit card expenditure abroad averaged €324 million during June, July and August 2015.  Over the same period, credit card expenditure averaged circa €198 million. The value of debit card expenditure outside Ireland is generally higher than the equivalent credit card transactions, reflecting the inclusion of ATM transactions.

Almost 69 per cent of all personal credit card expenditure at end-February 2016 was split between both the retail and services sectors (Chart 5).  However, over the same period, debit card expenditure in the retail sector accounted for almost half of all new debit card PoS transactions.

The primary aim of the data collected in the CDR (Credit/Debit Card Return) return is to inform national and euro-area policy making, and to enhance understanding of the role of credit/debit cards in the domestic financial system. Only euro-denominated credit/debit cards issued to Irish residents are included in the compilation of the CDR data.  Monthly CDR data is derived from a sample of reporting entities heavily engaged in the provision of credit/debit services to Irish residents.

The CDR sectoral breakdown is compiled referencing the MCC code system for credit/debit card transactions.  A merchant category code (MCC) is generally a four-digit number assigned to a business by credit card companies (e.g. American Express, MasterCard or Visa) when an entity first begins to accept one of these cards as a form of payment. The MCC is used to classify the business by the type of goods or services it typically provides.