New Zealand credit and charge card payments market to reach nearly $40bn in 2028, forecasts GlobalData. Source: Shutterstock.com

The New Zealand credit and charge card payments market is forecast to register a compound annual growth rate (CAGR) of 4.4% between 2024 and 2028 to reach NZD64.5bn ($39.6bn) in 2028, supported by the constant consumer shift towards electronic payments, according to GlobalData, publishers of EPI.

GlobalData’s Payment Cards Analytics reveals that credit and charge card payment value in New Zealand registered a growth of 10.7% in 2022, driven by the rise in consumer spending. The value grew further to register a growth of 5.5% to reach NZD53.5bn ($32.8bn) in 2023.

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Ravi Sharma, Lead Banking and Payments Analyst at GlobalData, comments: “New Zealand is gradually moving towards the digitalization of its payment infrastructure, supported by a 100% banked adult population, mature payment card market, and the expansion of POS infrastructure. New Zealand consumers are prolific users of credit and charge cards, with frequency of payments at 312.4 in 2023 – one of the highest in the world.”

Although credit and charge cards account for a limited proportion of cards in circulation, they account for 52.2% share in value in 2024

This can be attributed to the value-added benefits offered by banks, such as reward points, discounts on purchases, and annual fee waivers.

To reduce the dependence on cash and promote credit and charge card payments, Payments NZ has introduced various measures as part of its Payments Modernisation Plan 2030. These measures include improving financial inclusion, promoting acceptance of credit and charge card payments by merchants, and supporting competition and innovation in the payments space, thereby benefiting overall credit and charge card payments market.

The rise in online payments is also contributing to the higher usage of credit and charge cards. They are the primary method of payment for e-commerce transactions in New Zealand, accounting for 36.6% of total e-commerce transaction value in 2023, according to the GlobalData’s 2023 Financial Services Consumer Survey.

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This is due to their convenience and security, aligning with consumers’ general preference for cards. Additionally, benefits such as reward points, cashback, and discounts further incentivize the use of cards for e-commerce purchases.

Sharma concludes: “The forecast for the growth of total credit and charge card payments in New Zealand is promising due to increasing preference for contactless payments, and the growth of the e-commerce market. However, challenges such as high inflation, and geopolitical uncertainty remain obstacles to the market. The credit card payments market is expected to grow by 1.5% to reach NZD54.3bn ($33.3bn) in 2028.”