The number of credit cards in circulation hit 20.06 million.
Despite the proliferation of e-payment alternatives, Hong Kong residents continued to embrace credit cards as their preferred payment method after the total value of credit card transactions rose 15.4% YoY to $178.9b in Q2, according to the Hong Kong Monetary Authority.
Of this figure, three fourths (76.8%) was related to domestic retail purchases whilst 16.7% were for overseas retail expenses. Around 6.5% of the quarterly credit card transactions were traced to cash advances.
The total number of credit card transactions also booked double-digit growth after rising 17.1% YoY to 181.11 million transactions in Q2 as the number of credit cards in circulation hit 20.06 million in Q2. The sustained adoption is in line with a report by the Hong Kong Productivity Council recognising credit cards as the second most preferred consumer payment option for day-to-day purchases, trailing only behind the ubiquitous Octopus Card.
Millennials have emerged as the main growth engine of Hong Kong’s continued credit card growth as they accounted for two out of every three dollars added to the credit card industry from Q2 2017 to Q2 2018, according to consumer credit reporting agency Transunion.
Transunion adds that the millennial demographic holds a fourth (25.8%) of the city’s total card balances whilst the older generation of baby boomers (born 1946 to 1964) reduced their balances by 3.9% over the same period.
“As we’ve seen in recent quarters, the youngest generations are driving growth in the consumer credit market,” Brendan le Grange, director of research and consulting for TransUnion Hong Kong said in a statement. “This bodes well for the overall Hong Kong market today and in the future.”
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