Boston, MA -- (SBWIRE) -- 07/08/2013 -- The card payments channel declined in terms of number of cards in circulation. The prepaid card category was the only channel to record growth during the review period. In terms of number of cards in circulation, prepaid cards increased from 73,431 cards in 2008 to 198,600 cards in 2012. The number of prepaid cards is projected to grow at a CAGR of 15.27% over the forecast period to reach 438,222 cards in 2017. Banks are offering tailor-made products to drive adoption and increasingly target the young population. The younger generation is a considerable and growing target segment. According to the US Census Bureau, there were 776,724 people aged between 15-24 years, representing 11% of the country's total population in 2012. According to the National Statistical Institute of Bulgaria, 81.3% of individuals aged between 16-24 years use the internet regularly for online shopping. To entice the younger population, banks are offering debit and credit cards with special discounts and privileges. Corporate cards designed to meet specific business needs have been introduced. For example, First Investment Bank offers MasterCard Business and Visa Business credit cards which help to manage business travel expenses and offers free insurance. Retail customers consider cost as a major determining factor over service and convenience. Due to the Eurozone crisis, price has become a major deciding factor in determining card payment options. To remain competitive, financial card providers charge minimal interest rates and low charges along with extended repayment facilities.

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Key Highlights

- In terms of number of cards in circulation, debit cards category held the highest share of the card payments channel with 83.6% in 2012. The second largest channel share was held by credit cards with 13.6%, followed by prepaid cards with 2.8%.
- Prepaid cards gained momentum during the review period and recorded a high adoption rate. The prepaid cards category grew from 73,431 cards in 2008 to 198,600 cards in 2012, at a CAGR of 28.24%. Over the forecast period, the prepaid cards category is projected to grow at a CAGR of 15.27% to reach 438,222 cards in 2017.
- The debit cards category in Bulgaria is relatively mature and recorded a CAGR of -4.25%, in terms of the number of cards in circulation, during the review period. Over the forecast period, the debit cards category is projected to post a CAGR of -1.65% in terms of the number of cards in circulation.
- Internet penetration increased from 41.5% in 2008 to 57.6% in 2012. During the review period, internet penetration increased to 4.1 million users in 2012, growing at a CAGR of 7.72%. The growth in the number of internet users was largely driven by the country's high literacy rate and young population. Growth in the young population supported by increased internet penetration is expected to increase the use of card payments for online shopping.

Companies Mentioned in this Report: UniCredit Bulbank, DSK Bank, First Investment Bank (Fibank)

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