Consumer Payment Card News

Debit 2006

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Growth in off-line debit card volume in the U.S. continued to rebound in 2006, increasing 23% to more than $1 trillion. A new study has also found that issuers nationwide lost a total of $662 million to debit card fraud in 2005, a 21% increase over 2004. Of these losses, 60% resulted from ATM transactions, 37% from signature debit transactions and 3% from PIN POS transactions. Signature-based losses grew 28% in 2005, while PIN-based losses rose 17%. The study, commissioned by PULSE EFT Association by Dove Consulting, also found that debit card activation rates averaged 56% in 2006 for issuers that define “active” cards as those that have made one signature-based transaction in the last 30 days. On average, active cardholders performed 16.1 transactions per month — 10.6 signature-based and 5.5 PIN-based. More participating institutions offered debit card rewards in 2006 (37% compared to 33% in 2005). Of those participants that offer debit rewards, 37% reward cardholders for both PIN and signature transactions, compared to 29% in 2005. Survey participants expect to grow their debit card programs by an average 17% during 2007, representing 18% growth in PIN debit volume and 16% in signature debit.

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|_3. VISA & MASTERCARD SIG DEBIT HISTORICAL |
|_. Year |_. Volume |_>. Y/Y |
|_. 2000 |>. $ 301.8b |>. +37.9% |
|_. 2001 |>. $ 420.7b |>. +39.4% |
|_. 2002 |>. $ 496.4b |>. +18.0% |
|_. 2003 |>. $ 576.6b |>. +16.2% |
|_. 2004 |>. $ 686.0b |>. +19.0% |
|_. 2005 |>. $ 823.5b |>. +20.0% |
|_. 2006 |>. $1010.8b |>. +22.8% |
|_3. Source: CardData (www.carddata.com) |

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