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Luxembourg’s payment cards (including debit and credit cards) grew at a significant compound annual growth rate (CAGR) of 23.14%, between 2009 and 2014. In terms of transaction value, payment cards produced EUR10.2 billion (US$13.5 billion) in 2013, registering a CAGR of 10.60%, during the same period.
According to a new report marketed by Research and Markets, the number of cards-in-force grew from 992,348 cards in 2009 to 2.3 million in 2013. Based on the CAGR the number of cards-in-force at EOY 2014 is approximately 2.6 million.
Like other EU countries, Luxembourg’s economy was damaged by the 2009 global economic crisis. Following strong economic growth from 2004 onwards, Luxembourg’s economic growth contracted by 5.6% in 2009, but recovered gradually from 2010 onwards.
Economic turmoil in the global financial markets and lower demand during the peak of the recession prompted the government to inject capital into the financial services sector and implement stimulus measures to boost the economy.
A favorable tax regime coupled with bank-privacy legislation enabled the financial services sector, especially the banking and insurance sectors, to become the growth leader. Consequently, Luxembourg’s cards and payments industry thrived between 2009 and 2014.
In 2013, credit transfer was the preferred payment instrument, having a substantial industry share of 98.1%, in terms of transaction value, while payment cards accounted for just a 0.5% share. The use of cash is continuously decreasing due to a growing preference for electronic payment methods, resulting in cash’s share being halved during the review period, down from 1.5% in 2009 to 0.7% in 2013.
Improved banking infrastructure, new product developments, a higher awareness of electronic payments and wider acceptance of payment cards at point-of-sale (POS) terminals were the key factors driving growth. The adoption of Europay, MasterCard and Visa (EMV) standards also supported the industry’s growth.
In 2013, the average transaction value (ATV) in Luxembourg was US$121.0, which was the fifth highest in the European region. Greece recorded the highest ATV, with US$227.6, followed by Switzerland (US$156.6), Italy (US$141.2) and Germany (US$131.5). However, Luxembourg recorded the region’s highest card penetration of 4.43 cards per inhabitant in 2013, followed by Norway (2.73), the UK (2.48), Sweden (2.38) and Belgium (2.04).
2009: 1.0 million
2010: 1.2 million
2011: 1.5 million
2012: 1.8 million
2013: 2.3 million
2014: 2.6 million
Source: Research and Markets; CardData
Fore more details:http://www.researchandmarkets.com/research/r8c4zc/luxembourgs
For more data on European Cards access CardData®. For information and commentary on European Cards visit the searchable CardFlash® Library of more than 58,000 articles published since 1995. RAM Research® forecasts on European Cards are available exclusively through CardWeb.com.®