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The debit card market, which has played a second fiddle in terms of popularity to credit cards, is expected to see a 50% to 70% growth in terms of usage this year.
“Usage of debit cards in recent years has risen given the consumers’ increasing comfort and familiarity with them. Debit cards also have their own suite of benefits such as discounts, rebates and reward points. These benefits have encouraged customers to switch payment modes from cash to debit cards,” (The Association of Banks in Malaysia (ABM)).
At the same time, credit cards still dominate the market even when they are outnumbered by debit cards.
Based on the latest statistics, the average value of annual transaction per card for credit cards in 2010 stood at RM9, 338 while that for debit cards was merely RM141.
According to a local industry insider:
Apart from being a mode of credit and payment, credit cards have also been established as a “status symbol” with various affinity and co-branded credit cards.
But recently banks have been more cautious regarding their credit card businesses, and the central bank has issued new and tighter credit card guidelines, making credit cards less readily available to general consumers, thus creating more opportunities for debit cards.
The minimum annual income requirement for credit card eligibility has been raised to RM24,000 from RM18,000 previously.
For cardholders earning RM36,000 per annum and less, they can only hold credit cards from a maximum of two issuers and the maximum credit limit for those earning less than this amount had also been capped to double the monthly income of the card holder from each issuing bank.