MasterCard International and Pulse EFT Association surveys agree that consumers are using debit cards more often and for a wider array of purchases.
In MasterCard’s survey, 85% of responding debit card holders reported using their cards for monthly purchases, up from 74% in 2001. There was only a modest increase in the number of consumers who own a debit card: 66% of checking account customers, up from 61% three years ago.
But usage was up, and debit made particular inroads in “micropayments” — purchases under $20. MasterCard said debit accounted for about one-third of all micropayments, a 61% increase over 2001. Meanwhile, cash micropayments dropped by 11 percentage points, to 64%.
MasterCard’s survey was conducted in December; Pulse’s, administered by Analytica Inc. of Houston, in January and February. Reports on both were issued last week.
Pulse said debit transactions, mostly those authorized by personal identification numbers, were the most popular form of payment across three merchant categories: grocery, gas, and major box retailers.
Over all, 28% of those surveyed said they prefer cash or check, 54.3% debit cards, and 17.8% credit cards.
Stan Paur, Pulse’s president and chief executive officer, said check users were the least happy with their payment method.
MasterCard, of Purchase, N.Y., and Pulse, of Houston, came to different conclusions about the relative popularity of PIN and signature transactions.
MasterCard, which processes nearly all signature transactions for its U.S. debit cards, found an even split among the 750 debit-card-carrying adults it surveyed.
Pulse which processes mostly PIN transactions, compared five different payment methods: PIN debit, signature debit, credit, check, and cash. Of 716 respondents, 23.5% paid most often with PIN debit and 17% with signature.
Over all, 17.8% of consumers prefer credit cards and 54.3% debit cards, Pulse’s survey found.
It found PIN debit most popular and signature debit second at grocery stores and major retailers.
At grocers the figures were 42.3% for PIN, 30.2% for signature, 21.5% for cash, 16.2% for credit card, and 11.6% for checks. (The figures total more than 100% because some respondents chose more than one top preference, Analytica said.) At major retailers they were 37.7% for PIN, 28.4% for signature, 21.4% for credit cards, 17.6% for cash, and 10.5% for checks.
For paying at gas stations, 30.9% of Pulse’s respondents said they used PIN debit most often, 25.1% cash, 8.5% oil company credit cards, 24.2% major credit cards, 19.3% signature debit, and 2.7% checks.
Pulse said 94.5% of consumers had not noticed any reduction in retail prices since August, when Visa U.S.A. and MasterCard lowered their debit fees as part of their settlements of the so-called Wal-Mart suit.
