Credit Card Cash Transactions Demand Falls in Flourishing 2018 U.S. Economy

Credit card cash transactions (CTX) for Visa and Mastercard U.S. credit and debit cards in the U.S. declined by 2.3% year-on-year (YOY) in the fourth quarter (4Q/18).

U.S. 4Q/18 credit card cash transactions were flat YOY, while U.S. debit card CTX decreased 2.3% YOY, according to figures collected by CardData.

Visa’s 4Q/18 CTX for U.S. credit cards was also flat YOY and debit card CTX dipped 3.5% YOY.

Mastercard’s 4Q/18 CTX for U.S. credit cards were flat YOY and debit card CTX grew 1.3% YOY.

Lower Consumer Demand

The decline in cash advances is driven by lower consumer demand created by lower unemployment rates. The rising cost of credit card cash advances carrying maximum interest rates, high processing fees and immediate interest assessment are also impacting consumer demand, according to analysis by RAM Research.

Cash Transaction Stats

In the fourth quarter U.S. CTX for Visa and Mastercard (credit + debit) came in at 1254 million, compared to 1294 million for the prior quarter and 1283 million in the year ago quarter. The average cash transaction for credit and debit combined is $159.62.

Visa posted 924 million in U.S. cash transactions for 4Q/18, compared to 957 million in 3Q/18 and 957 million in 4Q/17. Visa’s average cash transaction for credit and debit combined is $153.68.

Mastercard posted 330 million in U.S. cash transactions for 4Q/18, compared to 335 million in 3Q/18 and 326 million in 4Q/17. Mastercard’s average cash transaction for credit and debit combined is $176.29.

Cash Advance Fee Income

U.S. credit card cash advance fee income dropped 4.2% YOY for EOY 2018, compared to a 24.8% YOY decline for EOY 2017. U.S. credit card cash advance fee income was $17.7 billion for EOY 2018, compared to $18.2 billion for EOY 2017, and compared to $16.0 billion for EOY 2014.