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Credit Cards in the UK - 2006

The Apex Group
February 1, 2006
57 Pages - SKU: ODS1297473

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Countries covered: United Kingdom

Growth in consumer credit has been one of the most important and controversial forces behind the UK economy’s sustained economic expansion during the past decade, and credit cards have been at the leading edge of this development. Praised by some for democratising credit by making it more readily accessible to the mass market but demonised by others for luring consumers into record levels of debt that may ultimately prove unsustainable, credit card companies are coming under increasing media and regulatory scrutiny.

During the period 2000-2005, the value of transactions conducted using plastic cards grew from £171.2 billion in to an estimated £347.2 billion ($613.5 billion). The average annual growth rate was 15.3%, with the market expanding by an estimated 12.4% in 2005. This growth has been driven by a number of factors, namely the number of transactions using plastic cards, an increasing average value of transactions, and the number of cards in issue.

The top five players in the plastic card market are estimated to have accounted for accounted for 84.3% of spending on credit cards in 2004. These banks are commonly referred to as the UK’s “Big Five” retail banks.

There are two major challenges to the dominance of the banks. Powerful US brands such as MBNA and Capital One have been making aggressive efforts to penetrate the UK market in recent years, while supermarket own brand offerings, such as the those offered by Sainsbury’s Bank (a joint venture between Sainsbury’s and HBOS) and Tesco Personal Finance (a joint venture between Tesco and RBS) utilise their retail networks and brands to issue credit cards.

ODS believes that these factors, together with the growth of e-commerce, rising debt levels and bankruptcy rates, changing fee structures, the maturation of security technology and nascent threats from rival payment systems create a level of uncertainty in the industry that warrants detailed examination.

Credit Cards in the UK - 2006 aims to document the development of the UK Credit Card market, estimate its size, analyse its structure and segmentation, profile its major players, outline current trends, evaluate competitive threats, assess likely future developments and forecast growth rates.

1 Introduction
2 Definition
3 Executive Summary
4 Strategic Overview
5 Market Size: 5.1 Value of Plastic Card Transactions; 5.2 Volume of Plastic Card Transactions; 5.3 Average Value of Transactions; 5.4 Number of Plastic Cards in Issue; 5.5 Credit Outstanding on Plastic Cards and Percentage of Balances Incurring Interest
6 Market Sectors: 6.1 Credit Card Transactions, Structured Personal Loans and Overdrafts; 6.2 Purchases, Cash Withdrawal and Balance Transfers; 6.3 Volume and Value of Transactions conducted Using Credit and Debit Cards; 6.4 Plastic Card Spending by Economic Sector
7 Market Share
8 Marketing & Advertising ActivitY
9 Future Developments: 9.1 Regulation; 9.2 Marketing; 9.3 Technological Development
10 Corporate Overview: 10.1 Royal Bank of Scotland Group; 10.2 Barclaycard; 10.3 LLoyds tsb; 10.4 HBOS; 10.5 HSBC
11 Consumer Profile & End Usership
12 Distribution
13 Market Forecasts
14 Sources & Definitions: 14.1 Main Data Sources; 14.2 Annual Reports / Corporate Websites; 14.3 Government & Regulatory Bodies; 14.4 Pressure groups, advisory services and other consultants; 14.5 Other Research & Media Resources
15 For Further Information
LIST OF TABLES: Table 1: Value of Plastic Card Transactions and Year-on-Year Growth Rates, (£m and %), 2000-2005(est.); Table 2: Number of Plastic Card Transactions and Year-on-Year Growth Rates, 2000-2005(est.); Table 3: Average Value of Plastic Card Transactions and Year-on-Year Growth Rates (£ and %), 2000-2005 (est.); Table 4: Number of Plastic Cards in Issue and Year-on-Year Growth, 2000-2005 (est.); Table 5: Average Credit Outstanding per Account and Year-on-Year Growth (£ and %), 2000-2005 (est.); Table 6: Proportion of Plastic Card Balances Incurring Interest and Year-on-Year Growth (%), 2000-2005 (est.); Table 7: UK Credit Card Transactions, Structured Personal Loans and Overdrafts 2003-2005 (est.); Table 8: Credit Card Transactions: Purchases, Cash Withdrawal and Balance Transfers, 2000-2005 (est.), £m and Year-on-Year Growth; Table 9: Volume of Transactions Using Plastic Cards 2000-2005; Table 10: Value of Transactions Using Credit versus Debit Plastic Cards, 2000-2005(est.), £m and Year-on-Year Change; Table 11: Value of Transactions Using Plastic Cards by Sector 2000-2005; Table 12: Value of Transactions Using Plastic Cards by Sector as a Percentage of Total Spending in 2000 and 2004(£m and %); Table 13: Plastic Card Market Shares; Table 14: Total Spending by Financial Services Industry on Press and TV Advertising; Table 15: Leading Plastic Card Issuers by Advertising Spend, 2004 (£m); Table 16: Credit and Debit Card Fraud Losses (£m), 2001-2004; Table 17: Corporate Positioning - Market Share and Growth Rates, 2004; Table 18: Retail Direct Turnover and Profits; Table 19: Barclaycard Turnover and Profits; Table 20: Lloyds TSB Retail Banking Turnover and Profits; Table 21: HBOS Turnover and Profits; Table 22: HSBC UK Personal Financial Services Turnover and Profits; Table 23: Proportion of UK Consumers holding Credit, Debit and Credit & Debit Cards, 2004 (%); Table 24: Number of Branches of Five Largest Plastic Card Companies; Table 25: Number of Personal Customers Registered to Access their Accounts by Computer, 1999-2004; Table 26: Forecast for Plastic Card Market 2005-2009; Table 27: Sector Forecasts for Credit and Debit Cards 2005-2009
LIST OF FIGURES: Figure 1: Value of Plastic Card Transactions, (£m), 2000-2005(est.); Figure 2: Number of Plastic Card Transactions, 2000-2005 (est.); Figure 3: Average Value of Plastic Card Transactions (£), 2000-2005 (est.); Figure 4: Number of Plastic Cards in Issue versus UK Population over 18 years of age, 2000-2005(est.); Figure 5: Average Credit Outstanding per Account (£), 2000-2005 (est.); Figure 6: Proportion of Plastic Card Balances Incurring Interest (%), 2000-2005 (est.); Figure 7: UK Credit Card Transactions, Structured Personal Loans and Overdraft, 2003-2005 (est.); Figure 8: Credit Card Transactions: Purchases, Cash Withdrawal and Balance Transfers; Figure 9: Volume of Transactions Using Plastic Cards 2000-2005; Figure 10: Value of Transactions Using Credit versus Debit Plastic Cards, 2000-2005(est.), £m; Figure 11: Value of Transactions Using Plastic Cards by Sector 2000-2004; Figure 12: Value of Transactions Using Plastic Cards by Sector as a Percentage of Total Spending in 2000 and 2004; Figure 13: Plastic Card Market Shares Chart; Figure 14: Comparative Advertising Spend by Leading Plastic Card Issuers, 2004; Figure 15; Credit and Debit Card Fraud Losses (£m), 2001-2004; Figure 16: Company Positioning Matrix

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