The demise of credit cards has accelerated as more Maltese are turning to alternative payment options such as Revolut, a report by the Central Bank has found.
In a review of card and digital payment options that was published this week, the bank found that credit cards appear to be on a decreasing trend, falling from 183,986 credit cards issued in 2016 to 167,569 in 2020.
The greatest drop was registered last year, at the height of the pandemic, when the number of credit cards issued dropped by 10,149 when compared to 2019.
The number of debit cards increased in 2017 and rose again in 2020. However, despite that, the total number of locally issued cards in circulation, both debit and credit, dropped by around a tenth compared to 2017.
This, the bank said, may reflect the increased use of alternative payment methods, such as mobile applications like Revolut.
The global financial platform allows peer-to-peer payment through one’s mobile phone and has taken the banking and payment world by storm. By February, it said it had attracted more than 190,000 customers in Malta.
The central bank collects card payment data from all credit, payment and e-money institutions to analyse the country’s payment trends.
Cards in general are gaining popularity among consumers mainly because they are more convenient and more reliable than cash or cheques.
The number of local debit cards significantly exceeds the number of credit cards. The bank said that debit cards and e-money cards each accounted for nearly 45 per cent of the total number of new payment cards issued in 2020.
Cards in general are gaining popularity
Point of Sale terminals that allow contactless transactions are also increasing rapidly, the bank found. While in 2016 only around two per cent of POS terminals where contactless, by 2018 around half had this feature, increasing to 87 per cent the following year.
In 2020, there were more than 16,000 contactless POS terminals – 95 per cent of all terminals.
According to the central bank report, the volume and value of payments effected at POS terminals with debit and credit cards have been increasing steadily.
Payments with debit cards rose by 47 per cent, from 16 million in 2016 to 23 million in 2020.
These transactions went from €902 million in 2016 to €1.1 billion in 2019, to reach €1.2 billion in 2020.
The bank said the continued increase of card transactions, even during the pandemic in 2020, was especially noteworthy as overall economic activity had dropped.
In other words, more and more people are turning to their cards to effect payments.
The figures also show that people are increasingly using their cards to make smaller purchases.
As for online transactions, the total volume increased by seven per cent over two years, from 18 million in 2019 to 19 million in 2020.
However, their total value fell by seven per cent, from €1.3 billion in 2019 to €1.2 billion in 2020, reflecting the drop in private consumption during that year.
Independent journalism costs money. Support Times of Malta for the price of a coffee.Support Us