Visa recently released their fiscal fourth quarter earnings report detailing how much was spent on Visa credit and debit cards in the United States. Visa’s fiscal fourth quarter is the three months ending in September and during this time spending on Visa credit cards outpaced spending on Visa debit cards, the first time this has happened since 2005. Visa credit card purchases grew 10 percent over this fiscal quarter, reaching $228 billion. Debit cards brought in more volume, $288 billion, but this was only an 8.1 percent increase for the fiscal quarter. In Visa’s fiscal fourth quarter of 2010 spending on debit cards grew 20 percent while credit card spending only increased by 6.4 percent.
This is the first time Visa credit card spending grew faster than debit card spending in the U.S. in the past six years, and as financial institutions impose new banking and debit card fees in response to the Durbin Amendment we can expect this trend to continue. In the world of eCommerce credit cards are used much more than debit cards and this trend is expected to continue as well. Javelin Strategy and Research predicts that from 2011 to 2016 the total online payment volume for credit cards in the U.S. will increase by 63 percent while online debit card payment volume will only grow by 2 percent.
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