Growth in the amount of money spent using debit, credit and prepaid cards slowed significantly over the first six months of this year, with the transaction volume rising by 6.6 percent in January-June 2019 year-on-year compared to more than 10 percent in the previous year, according to bank data Kathimerini has seen.
The amount spent using plastic amounted to 17 billion euros in the year to end-June, against 15.9 billion in the same period last year. This slowdown points to an annual increase of just 5 percent at end-2019 compared to 2018.
The drop in the growth rate is attributed to two main factors. The first is the decrease in tourists’ expenditure in Greece, which in the first half of the year shrank to 2.8 billion euros from 3.2 billion last year, or an 11.4 percent annual decline.
The second factor is growth fatigue, with the increase in the rate of transactions made using debit, credit and prepaid cards having slowed from a peak of around 30 percent in previous years. The value of card transactions made by Greeks came to 14.2 billion euros, up from 12.8 billion a year earlier, i.e. an 11 percent advance.
The January-June data are generating concern in the banking sector regarding the use of plastic money in everyday transactions, as, despite the continuing growth, bank officials realize that the momentum of previous years appears to be gradually weakening. They say the impact of measures such as the tax discount through online transactions has been exhausted and that additional incentives are required for the further penetration of card use. These incentives, they add, should generate a substantial benefit for consumers so as to prevent them from not bothering to ask for a receipt for cash transactions for goods or services with a high value-added tax rate.
Debit and credit cards now account for 20 percent of all private consumption spending, far below more mature European markets.