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BPFI Payments Monitor shows significant growth in contactless payments

2nd November 2018

158 million contactless payments valued at €1.9bn in H1 2018 up 66% year on year

The latest BPFI Payments Monitor from Banking & Payments Federation Ireland (BPFI) shows significant growth in card payments, driven mainly by the widespread use of contactless payments and continued growth in digital banking. The monitor tracks key trends across a range of payment categories including digital banking, contactless payments, debit and credit cards and ATMs.

Contactless payments

In H1 2018 contactless payments (which includes contactless payments with both physical card and mobile based payments) grew by about 66% year-on-year in both volume terms and value terms to 158 million payments valued at €1.9 billion.

On average, debit cardholders made almost 35 contactless payments per card in the first half of 2018 and spent more than €421 per card. Credit cardholders spent almost €89 on average per card in the same period.

Digital Banking

Digital banking transaction volumes, including online and mobile banking, grew by 18.4% year-on-year to  46.8 million in H1 2018. Internet banking usage was highest among 30-44 year olds (83%) and in the midlands (81%), according to the CSO. At a European level Internet banking usage in Ireland was on a par with France, Switzerland and the UK but behind Scandinavian and Benelux countries.

Cash and Cheques

Despite the surge in card payments, cash demand remained strong with the value of cash withdrawn at ATMs on Irish debit cards rising to €9.4 billion, up 0.7% on H1 2017. ECB figures show that Irish cardholders were the third highest users of ATM cash withdrawals in the EU in 2017 after Austria and Hungary.

Cheque usage meanwhile continued to fall in early 2018, with volumes falling by 10.3% year-on-year in H1 2018. Large numbers of Irish Water refund cheques were issued in Q4 2017 so H2 2018 should see a further significant drop in volumes.

 

Speaking about the trends highlighted by the Payments Monitor Richard Walsh, Head of Digital & Payments Strategy, BPFI said:

Payment card usage has exploded in recent years thanks mainly to the rollout of contactless payment cards and smartphone-based mobile wallets. This is clearly demonstrated when you consider that contactless payments accounted for 63 million of the 83 million additional card payments in the first half of this year which is considerable.

Looking at the picture across the EU and how we compare with our European neighbours, the latest data from the European Central Bank (ECB) shows that card payments per capita in this country almost doubled between 2014 and 2017, making the rate of adoption of card payments by Irish consumers the highest in the EU and taking Ireland into the second tier of card payment nations in the EU, alongside Estonia, France and the Netherlands.

Despite the surge in card payments however, cash demand  remains strong with the number and value of ATM cash withdrawals increasing by 3.8% year-on-year to €5 billion in Q2 2018. At the same time, one positive sign of the move away from cash is the decline in the new bank note and coin issuance reported by the Central Bank.  The volume of bank notes issued fell by 18% year-on-year to 269 million in 2017 and the number of coins issued more than halved (down 54%) to 58 million.“

The BPFI Payments Monitor H1 2018 is available on the BPFI website here.

 

Notes: Banking & Payments Federation Ireland (BPFI) represents the banking, payments and fintech sector in Ireland.  Together with its affiliates, the Federation of International Banks in Ireland and the Fintech & Payments Association of Ireland, BPFI has over 70 member institutions and associates, including licensed domestic and foreign banks and institutions operating in the financial marketplace here.

Based on data from BPFI member banks and Central Bank of Ireland, the BPFI Payments Monitor provides a comprehensive picture of the various means of payment executed via the various payments systems in Ireland. The report, and the BPFI payments data series, are available on the BPFI website here.

Contact: Jillian Heffernan, Head of Communications, 087 9016880 or jillian.heffernan@bpfi.ie

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