Online and mobile banking thrives as decline of cheques gathers pace - BPFI

Cheque transaction volumes have fallen to their lowest level since at least 2008 while the popularity of online and mobile banking has continued to grow, the Banking and Payments Federation of Ireland (BPFI) has said.

Data from the banking lobby group published on Friday shows that online and mobile banking transaction volumes grew 4 per cent in the first six months of the year to 73.1 million, the highest half-year level since the data series began in 2016.

At the same time, cheque volumes slumped 12.1 per cent year-on-year to 7.5 million in the first half of 2023, the lowest volumes since at least 2008, according to the BPFI.

Gillian Byrne, head of payments at the lobby group, said the number of online and mobile banking payments has increased by 60 per cent since 2018 while direct debit payments have jumped 26 per cent. In contrast, cheque usage fell by more than half over the same period.

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The BPFI report also highlights recent Central Bank data showing that there were more than 604 million card payments valued at nearly €22.7 billion between April and the end of June alone.

Groceries and dining accounted for a vast majority of card payments over the period, amounting to a daily spend in the two sectors of €43.7 million and €16.1 million, respectively.

They were followed by €13.3 million spent daily at fuel stations and other automotive retail outlets.

“While most activity was in person, in Ireland, Irish cardholders also spent about €3.9 million on restaurants/dining outside Ireland,” the BPFI said.

“In terms of credit and debit card payments, there were more than 6.6 million payments processed per day in the second quarter,” Mr Byrne said.

“In-person payments outnumbered online payments by about three to one with some 4.5 million card payments per day and daily spending reaching almost €120 million. Contactless payments accounted for almost 85 per cent of these transactions in Ireland. Interestingly, 41 per cent of contactless payments were made with mobile wallets instead of physical cards.”

Contactless transactions are now used in the vast majority of physical sales, according to Central Bank data from September, but they still account for just a quarter of the value of all activity on credit and debit cards.

The data also showed that mobile wallets, such as Apple and Google Pay, are an increasingly popular method of payment. In the first half of 2023, mobile wallet card payments accounted for 32 per cent of all card transactions undertaken at the till.

However, in value terms, contactless card and mobile-wallet card payments account for a smaller proportion of overall point of sale card payment transactions, representing just 51 per cent and 22 per cent respectively.

The Central Bank said this was because contactless card payments are still more generally used for lower-value payments. Tap-and-go, for instance, is available only on transactions of up to €50.