Debit cards are the new “black” in the personal finance fashion stakes. How do you make them work best for you?
Debit cards are certainly in the limelight, fast becoming a popular option for Generations X and Y, who enjoy the flexibility and low fees the cards offer, along with the ability to buy online.
For those aged between 18 and 25 who don’t have a credit card, debit cards are particularly handy for buying items like clothes and concert tickets. Certainly advertising campaigns have targeted this age group and so that’s one of the reasons we have seen this option take hold amongst young adults.
Aside from being interest-free, debit cards also offer a series of other features and benefits not generally found with other account access methods. For example:
• Convenience: payWave on Visa Debit cards enable you to complete transactions of less than $100 in seconds, saving the need to fumble around for cash.
• Security – Press the ‘Credit’ button when making a purchase at EFTPOS terminals to obtain additional support from Visa against fraud.
• Online Purchases – A Visa debit card can be used to make purchases online. This can be great for purchasing concert tickets, buying clothes, or just about any other item available on the internet.
Internet purchases and the value of online spending is steadily increasing, to the point that our online purchases now account for 26 per cent of the total spend on our members’ Visa Debit cards.
We’re also seeing payWave grow in popularity and it’s beginning to replace the use of cash for smaller purchases of less than $15. We are even starting to see ATM use decline as more consumers use cards at the point of sale rather than cash.
While debit cards were primarily introduced to suit the needs of younger generations, giving them security and flexibility for payment options, the appeal is also extending to those in the 35 to 45 age bracket.
The Visa Debit card is also an account option for people under 18. However, whilst it is highly secure, we recommend usage is monitored and parents or caregivers provide guidance to avoid transactions being made on unsafe or unauthorised websites.
We believe debit card uptake will continue to spread to other age groups as the card becomes more ingrained in the market. Longer term, we expect that smartphone technology will be used eventually to replace the traditional plastic card and enable us to complete purchases via our phones.
Any questions? Feel free to comment below.
^Wayne – Chief Financial Officer