The Cards and Payments Industry in Australia: Emerging Trends and Opportunities to 2019

Australia’s payment cards market is one of the world’s most developed. In 2014, the Australian payment cards market accounted for 5.1% of the transaction value and 11.2% of the transaction volume in the Asia-Pacific. The average number of monthly card transactions, and the average annual spend per card are higher in Australia than in other mature markets such as the US, the UK, Canada and Germany.

Electronic payments have steadily gained in popularity in Australia, aided by contactless technology’s rising prominence in the country. Banks such as CBA, National Australia Bank (NAB) and Westpac offer payments based on contactless technology.

Consumers increasingly use faster and more secure payment options, resulting in mobile operators, traditional and online retailers, and other service providers introducing digital payment options. These include online and mobile payments, and are conducted through alternative instruments such as Bpay, Paymate, MasterPass, Visa Checkout and POLi.

Payment card product preferences changed during the review period, with a gradual shift in favor of debit cards. The shift away from credit card use can be explained by factors such as increased consumer avoidance of debt, and Reserve Bank of Australia’s (RBA) initiatives to regulate interchange fees. RBA’s intervention to cap the debit interchange fee and remove surcharges on card transactions. The ‘honor all cards’ rule, which allows merchants to accept cards, succeeded in changing the relative prices of using debit cards. This resulted in increased spending on debit cards during the review period; a trend that is expected to continue in the future.

Scope

•A comprehensive analysis of Australia's cards and payments industry.

•Current values for the industry for 2014, with forecast figures up to 2019.

•Details of the different economic, infrastructural and business drivers as they affect the industry.

•An analysis of the current regulatory framework in the industry.

•A review of the marketing strategies adopted by banks and other institutions in the industry.

•Profiles of the major banks in the industry.

•Detailed insights into payment instruments, including: credit transfers, check payments, direct debits, payment cards and cash transactions.

•Analyses of various market drivers and regulations governing the industry.

•A comprehensive analysis of consumer attitudes and buying preferences for cards.

•Detailed GlobalData data on the number of cards in circulation, along with transaction values and volumes during the review period, in addition to those predicted over the forecast period.

•Detail of regulatory policies and recent changes in regulatory structure in the Australian cards and payments market.

Key Highlights

What significant event in the Australian cards and payments market accelerated the growth of contactless payments? What is predicted to drive payment card transaction values and volumes over the forecast period as a result?

How many contactless payments are made daily in the Australian market? What percentage of the total payment transactions does this represent?

What problem has been exacerbated by the increasing use of payment cards? Which body within the industry has attempted to curb this problem and what measures have they implemented?

What is being encouraged by the competition in the Australian payment cards market? What are the key gains for consumers from this market environment?

Reasons to buy

•Utilize GlobalData’s top-level historic and forecast market data to inform your strategic decisions in each category of Australia's cards and payments industry.

•Analyze the key market trends and growth opportunities to identify those which will provide impetus to your expansion in the industry.

•Assess the competitive dynamics in the industry, and ensure you position your products to obtain maximum competitive advantage.

•Investigate marketing strategies used for various card types in Australia, and align with those which provide you with the best opportunity to develop your market share.

•Gain insights into key regulations governing Australia's cards and payments industry, and address any compliance issues that might impact on your cost projections.

Companies mentioned

Commonwealth Bank of Australia

Westpac Banking Corporation

National Australia Bank

ANZ Bank

Citibank Australia

Cuscal

Eftpos

American Express

Visa

MasterCard

Table of Contents

1 Definitions and Methodology

1.1 Definitions

1.2 Methodology

2 Key Facts and Events

3 Executive Summary

4 Payment Instruments

4.1 Current Payment Environment

4.2 Alternative Payment Instruments

4.2.1 Bpay

4.2.2 POLi

4.2.3 Kaching

4.2.4 Paymate

4.2.5 PayPal

4.2.6 MasterPass

4.2.7 Visa Checkout

4.2.8 Starbucks mobile wallet

5 Regulations in the Cards and Payments Industry

5.1 Regulatory Framework

5.1.1 Standards under the Payment Systems (Regulation) Act, 1998

5.1.2 Interchange fee benchmarks

5.1.3 Payment cards access regimes for MasterCard, Visa and Visa Debit

5.1.4 Regulations governing the prepaid cards market in Australia

5.2 Anti-Money Laundering (AML)

5.3 Foreign Direct Investment (FDI) Regulations

6 Analysis of Cards and Payments Industry Drivers

6.1 Demographic Drivers

6.2 Economic Drivers

6.3 Infrastructure Drivers

6.4 Business Drivers

7 Market Segmentation and New Product Launches

7.1 Market Segmentation and Targeting

7.1.1 Consumer cards

7.1.2 Commercial cards

7.2 New Product Launches

8 Payment Cards

8.1 Payment Cards Analysis

8.1.1 Volume and value of payment card transactions by type

8.1.2 Personal vs commercial cards

9 Debit Cards

9.1 Debit Cards Market Analysis

9.1.1 Debit card transaction volumes and values by channel

9.1.2 Debit card scheme shares in terms of number of cards in circulation and transaction value

9.1.3 Debit cards issuers’ market shares

9.1.4 Debit cards comparison

10 Credit Cards

10.1 Credit Cards Market Analysis

10.1.1 Credit card transaction volumes and values by channel

10.1.2 Credit card scheme shares in terms of number of cards in circulation and transaction value

10.1.3 Credit cards issuers’ market shares

10.1.4 Credit cards comparison

11 Charge Cards

11.1 Charge Cards Market Analysis

11.1.1 Charge card transaction volumes and values by channel

11.1.2 Charge card scheme shares in terms of number of cards in circulation and transaction value

11.1.3 Charge cards comparison

12 Commercial Cards

12.1 Commercial Cards Market Analysis

12.1.1 Commercial cards comparison

13 Card Fraud Statistics

13.1 Card Fraud Analysis

14 Card Issuers

14.1 Commonwealth Bank of Australia

14.2 Westpac Banking Corporation

14.3 National Australia Bank

14.4 ANZ Bank

14.5 Citibank Australia

14.6 American Express

15 Prepaid Cards

15.1 Prepaid Cards Market Analysis

15.1.1 Prepaid cards comparison

16 Merchant Acquiring

16.1 Merchant Acquiring Market Analysis

17 Appendix

17.1 Tables

17.2 Contact GlobalData

17.3 About GlobalData

17.4 GlobalData’s Services

17.5 Disclaimer

List of Tables

Table 1: Key Definitions

Table 2: Annual Average Exchange Rate

Table 3: Australia – Key Facts, 2014

Table 4: Regional Benchmarking of Australian Payment Cards, 2014

Table 5: Australia – Modes of Entry of Foreign Banks

Table 6: Cards for High-Income Consumers, 2015

Table 7: Balance Transfer Credit Cards, 2015

Table 8: Cards for Travelers, 2015

Table 9: Shopping Reward Credit Cards, 2015

Table 10: Cards for Students and Youth Population, 2015

Table 11: Commercial Cards Comparison and Key Features, 2015

Table 12: Australia – New Product Launches

Table 13: Australia – Pay now, Average Interchange Fees: Intra-Network Transactions (%), 2010–2014

Table 14: Australia – Pay now, Average Merchant Service Charge: Domestic Transactions (%), 2010–2019

Table 15: Australia – Debit Cards Comparison and Key Features, 2014

Table 16: Australia – Pay later, Average Interchange Fees: Intra-Network Transactions (%), 2010–2014

Table 17: Australia – Pay later, Average Merchant Service Charge: Domestic Transactions (%), 2010–2019

Table 18: Australia – Gold Credit Cards Comparison and Key Features, 2015

Table 19: Australia – Premium Credit Cards Comparison and Key Features, 2015

Table 20: Australia – Charge Cards Comparison and Key Features, 2015

Table 21: Australia – Commercial Cards Comparison and Key Features, 2015

Table 22: Australia – Prepaid Cards Comparison and Key Features, 2015

Table 23: Australia – Merchant Account Fee Comparison, 2015

Table 24: Australia – Payment Instrument Transaction Values (AUD Billion), 2010–2014

Table 25: Australia – Payment Instrument Transaction Values (US$ Billion), 2010–2014

Table 26: Australia – Payment Instrument Transaction Volumes (Million), 2010–2014

Table 27: Australia – Number of Payment Cards in Circulation by Type (Million), 2010–2019

Table 28: Australia – Volume of Payment Card Transactions by Type (Million), 2010–2019

Table 29: Australia – Value of Payment Card Transactions by Type (AUD Billion), 2010–2019

Table 30: Australia – Value of Payment Card Transactions by Type (US$ Billion), 2010–2019

Table 31: Australia – Personal and Commercial Card Transaction Volumes (Million), 2010–2019

Table 32: Australia – Personal and Commercial Card Transaction Values (AUD Billion), 2010–2019

Table 33: Australia – Personal and Commercial Card Transaction Values (US$ Billion), 2010–2019

Table 34: Australia – Number of Debit Cards in Circulation (Million), 2010–2019

Table 35: Australia – Debit Card Transaction Volumes and Frequency by Channel, 2010–2019

Table 36: Australia – Debit Card Total and Average Transaction Values by Channel, 2010–2019

Table 37: Australia – Debit Card Total and Average Transaction Values by Channel, 2010–2019

Table 38: Australia – Number of Debit Cards in Circulation by Scheme (Million), 2010–2014

Table 39: Australia – Debit Card Transaction Values by Scheme (AUD Billion), 2010–2014

Table 40: Australia – Debit Card Transaction Values by Scheme (US$ Billion), 2010–2014

Table 41: Australia – Debit Card Transaction Values by Issuer (AUD Billion), 2010–2014

Table 42: Australia – Debit Card Transaction Values by Issuer (US$ Billion), 2010–2014

Table 43: Australia – Number of Credit Cards in Circulation (Million), 2010–2019

Table 44: Australia – Credit Card Transaction Volumes and Frequency by Channel, 2010–2019

Table 45: Australia – Credit Card Total and Average Transaction Values by Channel, 2010–2019

Table 46: Australia – Credit Card Total and Average Transaction Values by Channel, 2010–2019

Table 47: Australia – Number of Credit Cards in Circulation By Scheme (Million), 2010–2014

Table 48: Australia – Credit Card Transaction Values by Scheme (AUD Billion), 2010–2014

Table 49: Australia – Credit Card Transaction Values by Scheme (US$ Billion), 2010–2014

Table 50: Australia – Credit Card Transaction Values by Issuer (AUD Billion), 2010–2014

Table 51: Australia – Credit Card Transaction Values by Issuer (US$ Billion), 2010–2014

Table 52: Australia – Credit Card Balances Outstanding by Issuer (AUD Billion), 2010–2014

Table 53: Australia – Credit Card Balances Outstanding by Issuer (US$ Billion), 2010–2014

Table 54: Australia – Number of Charge Cards in Circulation (Thousand), 2010–2019

Table 55: Australia – Charge Card Transaction Volumes and Frequency by Channel, 2010–2019

Table 56: Australia – Charge Card Total and Average Transaction Values by Channel, 2010–2019

Table 57: Australia – Charge Card Total and Average Transaction Values by Channel, 2010–2019

Table 58: Australia – Number of Charge Cards in Circulation By Scheme (Thousand), 2010–2014

Table 59: Australia – Charge Card Transaction Values by Scheme (AUD Billion), 2010–2014

Table 60: Australia – Charge Card Transaction Values by Scheme (US$ Billion), 2010–2014

Table 61: Australia – Number of Commercial Cards in Circulation (Thousand), 2010–2019

Table 62: Australia – Commercial Card Transaction Values (AUD Billion), 2010–2019

Table 63: Australia – Commercial Card Transaction Values (US$ Billion), 2010–2019

Table 64: Australia – Card Fraud (AUD Million), 2010–2014

Table 65: Australia – Card Fraud (US$ Million), 2010–2014

Table 66: Australia – Number of Prepaid Cards in Circulation (Million), 2010–2019

Table 67: Australia – Prepaid Card Transaction Values (AUD Million), 2010–2019

Table 68: Australia – Prepaid Card Transaction Values (US$ Million), 2010–2019

Table 69: Australia – Merchant Acquiring Transaction Volume by Card Type (Million), 2010–2019

Table 70: Australia – Merchant Acquiring Total Transaction Value (AUD Billion), 2010–2019

Table 71: Australia – Merchant Acquiring Total Transaction Value (US$ Billion), 2010–2019

Table 72: Australia – Acquirers’ Transaction Volume (Million), 2010–2014

Table 73: Australia – Acquirers’ Transaction Value (AUD Billion), 2010–2014

Table 74: Australia – Acquirers’ Transaction Value (US$ Billion), 2010–2014

Table 75: Australia – Retail Outlets and Total Merchant Accounts (Thousand), 2010–2019

List of Figures

Figure 1: Australia – Payment Instrument Shares by Transaction Values (%), 2010 and 2014

Figure 2: Australia – Payment Instrument Shares by Transaction Volumes (%), 2010 and 2014

Figure 3: Australia – Total Population and Structure, 2014

Figure 4: Australia – Internet and Mobile Penetration (Users per 100 Inhabitants), 2010–2019

Figure 5: Australia – Economic Indicators, 2010–2019

Figure 6: Australia – Number of ATMs, POS Terminals and Commercial Bank Branches, 2010–2019

Figure 7: Australia – Household Final Consumption Expenditure and Retail Sales, 2010–2014

Figure 8: Australia – E-Commerce Value (US$ Billion), 2010–2019

Figure 9: Australia – Outbound and Inbound Trips Volume and Spending, 2010–2019

Figure 10: Australia – Cards and Payments Industry Segmentation by Card Type, 2015

Figure 11: Australia – Growth in Payment Cards Transaction Value and Number of Cards in Circulation by Type, 2010–2019

Figure 12: Australia – Volume and Value of Payment Card Transactions by Type (%), 2010–2019

Figure 13: Australia – Personal and Commercial Cards, Transaction Volume and Value (%), 2010–2019

Figure 14: Australia – Growth in Debit Card Transaction Values and Number of Cards in Circulation, 2010–2019

Figure 15: Australia – Debit Card Transaction Volumes and Values by Channel, 2010–2019

Figure 16: Australia – Debit Card Scheme Shares in Terms of Number of Cards in Circulation and Transaction Value (%), 2014

Figure 17: Australia – Debit Cards Issuers’ Market Shares in Terms of Transaction Value (%), 2014

Figure 18: Australia – Growth in Credit Card Transaction Values and Number of Credit Cards in Circulation, 2010–2019

Figure 19: Australia – Credit Card Transaction Volumes and Values by Channel, 2010–2019

Figure 20: Australia – Credit Card Scheme Shares in Terms of Number of Cards in Circulation and Transaction Value (%), 2014

Figure 21: Australia – Credit Cards Issuers’ Market Shares in Terms of Transaction Value (%), 2014

Figure 22: Australia – Credit Cards Issuers’ Market Shares in Terms of Outstanding Balance (%), 2014

Figure 23: Australia – Growth in Charge Card Transaction Values and Number of Charge Cards in Circulation, 2010–2019

Figure 24: Australia – Charge Card Transaction Volumes and Values by Channel, 2010–2019

Figure 25: Australia – Charge Card Scheme Shares in Terms of Number of Cards in Circulation and Transaction Value (%), 2014

Figure 26: Australia – Number of Commercial Cards in Circulation and Transaction Value, 2010–2019

Figure 27: Australia – Shares of Various Types of Card Fraud in Terms of Transaction Value (%), 2010 and 2014

Figure 28: Australia – Number of Prepaid Cards in Circulation and Transaction Value, 2010–2019

Figure 29: Australia – Merchant Acquiring Transaction Volume and Value, 2010–2019

Figure 30: Australia – Merchant Acquirers’ Market Share in Terms of Transaction Volume and Value %, 2014

Figure 31: Australia – Number of Retail Outlets and Total Merchant Accounts (Thousand), 2010–2019

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