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Plastic card spending growth slows in June

By 김정보

Published : July 23, 2013 - 09:21

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South Korea's plastic card spending maintained a stagnant growth in June as card holders continued to hold back their purchasing amid the economic slowdown, a trade association said Tuesday.

Purchases made with plastic cards totaled 44.5 trillion won (US$39.7 billion) last month, up 4.1 percent from 42.7 trillion won tallied a year earlier, according to the data by the Credit Finance Association (CREFIA).

The country's card spending growth sank to an all-time low in February, growing 3.4 percent on-year. It edged up 3.6 percent on-year in May.

The combined transactions made with plastics also came to 135.9 trillion won over the second quarter this year, up 4.1 percent from a year earlier. It marked the slowest quarterly growth since CREFIA started to compile such data.

The association said the slowdown came as consumers refrained from making purchases with plastics amid the protracted economic slowdown and card firms reduced benefits in line with the government's move to tighten credit card regulations to reduce the country's mounting household debt.

Purchases made with plastics at department stores dropped 10.6 percent on-year in the April-June period, as consumers refrained from buying luxury goods amid the economic slump.

In contrast, transactions made at convenience stores and supermarkets moved up 29 percent and 11.1 percent, respectively, as consumers purchased daily necessities by small volume.

South Koreans' purchases made with plastics at duty free shops, luxury hotels and travel agencies shed 20.8 percent, 17.1 percent, and 8 percent on-year, respectively, over the cited period.

Of the combined purchases made with plastics, credit cards came to 36.9 trillion won in June, up 2.9 percent from a year earlier, trailed by debit cards with 7.4 trillion won, which grew 11 percent over the cited period. (Yonhap News)