10 Billion Cards Circulating Around World
LONDON-The number of payment cards worldwide increased by 12% in 2012 to reach a landmark 10 billion, according to a new report from specialist research and consulting firm RBR. The company's latest report, "Global Payment Cards Data and Forecasts 2012-2018," said those 10 billion cards in circulation worldwide corresponds to an average of 2.3 cards per adult, but this varies from fewer than two in the Middle East and Africa (MEA) and central and eastern Europe (CEE) to six in North America, it said. As the banked population grows in developing markets card numbers will increase rapidly, RBR predicted. The new research forecasts that by 2018 there will be 13.6 billion cards in circulation worldwide.
The company said 182 billion card payments were made worldwide in 2012, up 10% compared to 2011. Growth in the number of payments is forecast to be faster than that in the card base over the next six years, partly boosted by contactless cards in some markets.
Getting Tough At The Top of the FICO Tiers
BIRMINGHAM, Ala.-It is getting tougher to win the credit card business of the very top FICO tiers, because card issuers have been stepping up their attention on this consumer segment. LowCards.com reports that research from Mintel reveals that direct mail credit card offers are on the rise, and the perks they come with continue to be attractive-including up-front cash bonuses, airline miles and 0% balance transfer offers. Mintel's research shows a 22% increase in direct mail credit card offers between 2011 and 2012.
LowCards.com CEO Bill Hardekopf noted that mobile ads for credit cards are getting more common. "But direct mail, apparently, must still be working well for issuers. Credit card marketers are some of the best marketing people, so if it was not working, they would know it."
Better Explanation Needed
BIRMINGHAM, Ala.-Credit card issuers need to do a better job of explaining their rewards programs, according to a new survey that also indicates there is a big revenue opportunity in doing so.
The 2013 Credit Card Satisfaction Study by J.D Power showed many consumers say they remain confused about their credit card rewards. Customer understanding of how to earn and redeem rewards with their credit card has dropped over the past year, with 59% of customers saying they "completely" understand how to earn rewards in 2013, compared with 66% in 2012. One-third of customers said they are unaware of the benefits associated with their card.
Customers who use their card's benefits spend an average of $400 more per month on their card, compared with those who are aware of benefits but do not use them, the study indicated.
"It certainly looks like many issuers are not explaining their rewards programs thoroughly to get consumers excited about using their cards," said Bill Hardekopf, CEO of LowCards.com. "Four hundred dollars in additional spend per month comes to about $5,000 a year per cardholder-a good reason to improve your communications."
