Competitor market shares and developments in the UK Plastic Card Market

Published by: Datamonitor

Published: Aug. 21, 2009 - 51 Pages

Table of Contents

Overview

Catalyst

Summary

Methodology

Table of Contents

Table of figures

Table of tables

Competitor Shares and Developments in the UK Card Market

Lloyds Group is now the largest credit card issuer by cards in issue

Barclaycards remains by far the dominant credit card brand

Barclaycard has the largest portfolio of 'primary' cards

The number of standard and premium cards by brand highlights the largest issuers' mass market strategy

Usage and primacy rates are driven by card features

The number and value of transactions per issuer is broadly in line with market share

Usage rates are low for most cards despite high rates of primacy

Lloyds Group has the highest value of balances outstanding

Not surprisingly, Citigroup and MBNA continue to have the highest balance per card on average

Repayment rates are significantly higher for cards providing incentives for transacting

The debit card market is led by the major high street retail banks

Barclays' leads the market, with 9.9 million debit cards in issue

Debit is growing strongly in day to day use

Santander now leads the private label card market

Private label usage rates are likely to drop as a result of the recession

Prepaid cards have strong growth potential, but are likely to remain niche

Barclaycard, Tesco Personal Finance and Santander have performed strongly in 2009

Barclaycard is pushing forward in creating incentives for card usage

Barclaycard is leading the market in developing contactless payments

Barclaycard is developing a new loyalty program

Barclaycard is forming strategic partnerships with key brands and service providers

Tesco Personal Finance is poised for strong growth as it moves to become a bank

Santander will expand in the cards market, to the detriment of MBNA

Card issuers must choose between diversifying and refocusing on core strengths

Appendix

Definitions

AAGR

Affinity card

APACS

ATM-only card

Average transaction value

Balances outstanding

Bank of England base rate

CAGR

Charge card

Co-branded card

Credit card

Debit card

FLA

Frequency of use

Non-standard

Private label card

POS terminal

Turnover per card per year

Methodology

Primary research

Secondary research

Further reading

Ask the analyst

Datamonitor consulting

Disclaimer

List of Tables

Table 1: Consumer perceptions of the features on their credit card by brand

Table 2: UK prepaid cards by number of cards in issue by brand and issuing group

Table 3: Prepaid transaction by type, frequency, value and average balance per card per year

Table 4: Current relevant publications, 2008-09

Table 5: Future relevant publications, 2009

List of Figures

Figure 1: Following the merger with HBOS, Lloyds now dominates the market

Figure 2: The newly formed Lloyds Group is now the UK market leader with 22.3% of cards in issue in H1 09

Figure 3: Barclaycard is the largest player by brand ahead of both Lloyds TSB, and HBOS

Figure 4: Barclaycard by far has the highest number of primary cards in the market

Figure 5: Tesco and John Lewis/Waitrose are the primary card for more than 75% of their customers

Figure 6: 40% of Barclaycard's cards in issue are premium branded

Figure 7: There were 278 million transactions made on Barclaycard branded credit cards in 2008, ahead of NatWest and Lloyds TSB branded products

Figure 8: Transaction values follow a very similar pattern to transaction numbers, with Barclaycard and NatWest leading the market in 2008

Figure 9: Regardless of total transaction values, average spend per transaction is highly variable

Figure 10: Tesco and American Express have the highest proportion of cards that are used all the time

Figure 11: Lloyds Group now has the highest level of balances outstanding, followed closely by MBNA

Figure 12: Lloyds holds 21% of the market by balances outstanding but is closely followed by MBNA at 20%

Figure 13: Citigroup has the highest average balance per card, growing 30% since June 2007

Figure 14: Repayment rates are higher for cards with rewards and incentives, with cardholder most likely to revolve on Virgin Money and MINT cards

Figure 15: The number of debit cards in issue has increased in H1 2009

Figure 16: The debit card market is evenly divided between the dominant big leading banks

Figure 17: POS makes up more than 70% of all debit transactions by volume

Figure 18: POS accounts for 60% of all debit transactions by value

Figure 19: Average spend levels are highly variable by issuer

Figure 20: Santander is by far, the dominant issuing group of private label cards as at H1 2009

Figure 21: Debenhams is the leading brand for private label store cards

Figure 22: The private label sector is fragmented, with Debenhams leading with a 17% market share

Figure 23: The overall number of cancelled private label cards in the UK market is high

Figure 24: With the highest brand awareness, Virgin and PayPal lead the prepaid cards market

Figure 25: The prepaid cards sector is dominated by four issuers accounting for 75% of the market

Figure 26: POS dominates prepaid card usage, with £5.5 billion of POS transactions in 2008

Figure 27: Barclaycard used viral marketing techniques as part of its campaign

Figure 28: MyBarclaycard will offer users in-depth online card management services

Figure 29: Barclaycard is strengthening its branding with younger consumers through strategic sponsorship

Figure 30: The Santander rebranding of Abbey has begun in London

Abstract

• Includes figures for all of the major UK credit issuers including number of cards, frequency of use, transaction values,and balances outstanding.
• Features detailed consumer behaviour data at the card issuer level, from Datamonitor's proprietary Financial Services Consumer Insight survey
• This brief includes up to date information on changes within the private label and prepaid cards markets.
• An analysis of the key developments in UK plastic cards is included, with real world examples of the strategies being followed by the leading players.

• Stay ahead of the competition with up to date market data on all of the major UK issuers in credit, debit, private label, and prepaid cards.
• Delve deeper into realworld cardholder behaviour and understand not just what cards consumers have, but what they do with them.
• Move with the market by understanding what todays market leaders are doing, and how others are adapting to a changing environment.

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