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Shoppers favour debit and credit over cash


December 9, 2010
By Amanda Ryder


Topics

NEWS HIGHLIGHTdebitcredit


Shoppers favour debit
and credit over cash

Consumers have more ways to pay than ever before, but
how are they paying for their purchases? A new study by Ipsos Reid
shows consumers heavily favour debit and credit cards over cash.

Dec. 9, 2010 – Consumers have more ways to pay than ever before, but how are they
paying for their purchases? A new study from Ipsos looks into the
subject. The Ipsos Payment Methods Report is the result of a
groundbreaking study exploring the factors and drivers influencing
payment method choice, preferences exhibited by different market
segments, and loyalty to card brands and issuers.

The study examines the way Canadian credit card holders use cash,
debit and credit cards for over-the-counter purchases. Results from the
study show that about one-in-three cardholders (34%) say they are heavy
debit card users, using it more than cash and credit cards combined.
One-in-four (25%) use credit cards more than the other methods of
payment combined. Only one-in-ten prefer to pay with cash. The
remainder (28%) use a more even mix of methods for personal spending.

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Heavy credit card users use credit cards twice as much as the
average cardholder, both in terms of frequency and dollar value. They
tend to replace the debit card with the credit card, using it for a
greater variety of purchases including grocery shopping and small
purchases – categories that are traditionally associated with cash and
debit.

“This indicates growth potential for credit card use,” says John
Mohler, Associate Vice President with Ipsos in Toronto. “While many
consumers have concerns about credit card use related to money
management or spending control issues, a minority see credit cards as
tools to manage spending and save money in the long run. As well,
credit card issuers have not yet fully tapped the grocery spending
segment – an area that is not necessarily impenetrable.”