Purchase Volumes For U.S. General Purpose Cards Crossed $3 Trillion In 2016

by Trefis Team
-23.72%
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110
Market
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Trefis
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Visa
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Purchase volumes for general purpose credit cards issued in the U.S. reached an all-time high of $3.06 trillion for 2016 – an 8% increase from the figure in 2015. Visa continues to dominate the industry with a market share of almost 51%.

Card_QA_Payment_Company_FY16

The figures above are based on data compiled by the Nilson Report in issue #1103 (February 2017). [1]

Notably, Visa’s credit card purchase volume for 2016 grew by more than 15% compared to 2015 – well above the 8% growth figure for the overall industry. This helped the payments giant increase its market share for the seventh consecutive year. On the other hand, American Express witnessed a 3% reduction in purchase volumes year-on-year. Costco’s decision to switch its partnership from American Express to Visa in mid-2016 was the single biggest reason behind this discrepancy in growth rates for the companies.

The chart below captures Visa’s GDV per transaction over the years as well as our forecast for it. You can see how changes to this metric affects our estimate for the company’s stock price by modifying this chart.

Notes:
1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment/ ask questions on the comment section
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to the full Trefis analysis for Visa | MasterCard | American Express | Discover

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Notes:
  1. Nilson Chart of The Month []
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