ECONOMY

Credit boom for Visa Hellas

Visa Hellas, the credit card company, yesterday underscored the strength of the credit boom driven by low interest rates as it announced sharp increases in both card holders and the volume of transactions in Greece at the end of June. With banks lowering their interest rates to converge with eurozone levels, Greeks have taken on more and more debt in the last few years as they have gone on a spending spree. According to statistics from the Bank of Greece, consumer credit continued to grow at strong double-digit figures this year, up by 30.6 percent in August. Growth in credit via credit cards has been even more dramatic, rising by 42 percent in August over a year ago, with outstanding credit amounting to 4,394 million euros. Card holders increased by 35.3 percent to 4.6 million at the end of June, Visa Hellas said. Credit card holders amounted to 3.2 million at the end of June, marking an increase of 39 percent. Charge card holders in turn rose by 27 percent to 1.4 million. The volume of transactions carried out by both credit and charge card holders shot up by 37 percent in a year to 3.7 billion euros. Visa Hellas has also seen its share in personal consumption spending edge up, although at a lower level than operations in other countries. The company’s share of such transactions at points of sales such as supermarkets, restaurants and hotels in Greece is less than 3 percent against 16 percent in the UK and 6 percent in Turkey. This compared with an average of 8 percent in the EU. Visa is currently promoting the adoption and use of smart cards, cards embedded with a chip that ensures greater security, in place of the magnetic strip cards. Smart cards are expected to replace more than 90 percent of the old credit cards in Europe by the end of 2004.