Credit and charge card payments to exceed $800b in 2026
The market is expected to grow at a CAGR of 3.9% between 2022-2026.
Hong Kong’s credit and charge card payments value is expected to reach $831.9b (US$106.7b) in 2026, according to GlobalData.
In a report, GlobalData said the market will likely grow at a compound annual growth rate (CAGR) of 3.9% between 2022–2026 given the “significant shift in consumer preferences towards non-cash payment methods and recovery in consumer spending.”
In 2020, credit and charge card payments declined by 17.1% due to a decline in consumer spending during the pandemic. The following year, the market saw a 15.4% growth, thanks to economic recovery and government initiatives.
This year, GlobalData forecast that credit and charge card payment value will register a 4.6% growth.
“Credit and charge cards are the most preferred payment cards in Hong Kong, accounting for 71% of total card payments by value in 2022. Government initiatives and opening of businesses have all increased consumer spending in Hong Kong, thereby benefiting its credit and charge card market,” Ravi Sharma, Lead Banking and Payments Analyst at GlobalData, commented.
Sharma added that Hong Kong has a card penetration of 2.7 cards per individual and a frequency of payments of 48.1.
The expert, however, warned that the market still faces several challenges, including global geopolitical risks and inflation.
Hong Kong’s inflation rate skyrocketed to 4.4% in September of 2022, and to tackle inflation, the central bank increased its benchmark interest rate to 4.75% in December 2022.
“Rising interest rates will increase borrowing costs on credit cards, thereby discouraging credit card spending in Hong Kong. The ongoing Russia-Ukraine crisis and rising energy prices resulted in economic uncertainty across the world. These factors are weakening consumer confidence about their financial situation and could affect overall spending,” Sharma said.
How ESG is measured in valuations and how enhanced green technology helps companies with purpose