Study finds many debit card users keeping higher checking account balances, and displaying stronger loyalty than they show to credit cards.
SALISBURY, Md.--(BUSINESS WIRE)--Phoenix Payments, a Phoenix Marketing International practice, today announced the results of its 2007 Consumer Payments Preferences and Usage Study: Debit Card Opportunities and Challenges. The study findings include a detailed report on debit card issues, covering consumer preferences, attitudes, and usage of debit cards as well as debit’s relationship to other payment methods.
Roughly three-fourths of U.S. consumers have one card association-branded debit card that is tied to their primary bank account. The debit card is therefore at “top of wallet” for these consumers, making them unlikely to switch debit cards for a “better offer” as they more readily do with credit cards. Debit activity gives the primary bank opportunities to increase loyalty and wallet share.
“To some extent, debit card usage has replaced check writing,” states Leon Majors, President of Phoenix Payments. “But debit is also replacing cash and credit cards. Increased debit card transactional activity is requiring cardholders to maintain larger bank account balances to draw upon for their payments.”The preference for debit cards over credit cards to pay bills is strongest among middle-aged and lower-income consumers. Older consumers and those with incomes above $100,000 are evenly divided in their preferences for the two card types.
“As the customer’s debit card use increases, transactional activity with the primary bank increases as well,” continues Majors. “Debit card usage at point-of-sale will continue to grow. PIN debit has particularly strong growth potential at walkup centers and for recurring bill payments.”
Phoenix’s annual Consumer Payments Preferences Study was conducted online in late 2007, surveying slightly more than 2000 consumers with a national representation of the online U.S. population. Phoenix Payments will present its detailed findings at the NACHA Conference in Las Vegas May 18-21. For an executive summary of the research, please visit http://www.phoenixmi.com/pdf/PhoenixConsumerStudy-ExecSummary.pdf.
About Phoenix Payments Practice
Phoenix Payments Practice is one of the most comprehensive financial consulting and research firms in the US; having the only integrated payments program that tracks the entire 200 billion plus financial transaction market through large-scale quantitative research, specializing in issues that are of strategic importance to retail and corporate financial services and technology vendors.
About Phoenix Marketing International (www.phoenixmi.com)
Founded in 1999, Phoenix Marketing International is one of the fastest growing marketing services firms in the United States and partner to many of the largest companies in the financial services, consumer package goods, automotive, healthcare, and travel and leisure industries worldwide. With national offices, Phoenix offers advanced advertising, brand measurement, and direct marketing expertise.
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