Payment Cards in France 2007 by shuifanglj


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Payment Cards in France 2007

Description:    Payment Cards in France is an invaluable guide to one of Europes most sophisticated card markets.
                The report provides statistics on market size, competitor market shares and acceptance. It also
                provides an overview of regulation, competitor activities, product innovation and market forecasts.
                It concludes with an analysis of the French market.


                - The focus of the report is on consumer payment cards, as opposed to commercial card products.

                - Data and analysis provided on debit cards, credit cards and deferred debit and charge cards.

                - The report parameters extend to card issuance only. Merchant acquiring and card processing are
                not covered.

                - Historic market data is presented for 2002-06, with forecasts presented to 2011. Competitor
                shares for card issuers are presented for 2006.

                Highlights of this title

                In 2007, ahead of introduction of rules for Single Euro Payment Area, which aims to free up
                competition in the payment card industry across the entire EU, Groupement des Cartes Bancaires
                announced that it will allow card issuers to enter into co-branded partnerships as of January 2008.

                Deferred debit and charge cards account for the largest share of total transaction values in France.
                At the end of 2006, the value of these transactions was €206.1 billion, which is equal to 61.7% of
                the market share.

                Over the last year contactless payment trials in France saw the introduction of the first EMV-
                enabled contactless payment card in Europe.

                Key reasons to purchase this title

                - Learn how the French consumer payment card market has developed over the last five years.

                - Understand recent developments in the market in terms of consolidation, new entrants and
                product innovations.

                - Use of The five year forecasts for the market to plan your future strategy.

Contents:       Overview 1
                Catalyst 1
                Summary 1
                Executive Summary 2
                Introduction 2
                Market context 2
                Competitor and product overview 3
                Forecasting the payment card market in France 3
                Table of figures 5
                Table of tables 6
                Introduction 7
What is this report about? 7
Scope of the report 7
Structure of report 7
Market Context 8
Introduction 8
Country overview 8
Demographics 9
Population 9
Economy 10
GDP 11
Inflation 14
Distribution of income (GINI Coefficient) 15
Segmentation of liquid assets 16
Unemployment 17
Market size 17
Payment cards in the context of consumer payments 17
Payment card statistics 19
Penetration of cards 19
Number of cards in issue 20
Number of transactions 21
Value of transactions 22
Card acceptance 24
ATM statistics 24
POS statistics 25
Regulatory environment 26
Structure of French retail banking 26
Commercial banks 27
Mutual and co-operative banks 28
Municipal credit banks (Caisses de crédit municipal) 28
There are only 20 municipal credit banks in France 28
The French banking structure is more complex than it seems 29
The hybrid structure means that the differentiation between commercial and mutual banks is
blurring 29
Finance houses are important players in the retail financial market 29
Other players in the retail banking market 30
Creation of a postal bank 31
Regulation of French retail banking 31
Regulatory bodies 33
Banque de France 33
Commission Bancaire 33
The Credit Institutions and Investments Firms Committee (CECEI) 33
The Banking and Financial Regulatory Committee (CRBF) 33
Banking associations 34
Groupement des Cartes Bancaires (CB) 34
Association Française des Etablissements de Crédit et des Entreprises dInvestissements (AFECEI)
Association Française des Sociétés Financières (ASF) 34
Fédération Bancaire Française (FBF) 35
Other noteworthy associations 35
Association Française des Banques (AFB) 35
Conseil National du Crédit et du Titre (advisory bodies) 35
Comité Consultatif 35
Credit bureaus 35
Regulatory issues in the market 36
European Consumer Credit Directive (CCD) 36
Despite being well intentioned, there are key problems with the directive 37
Key issues 37
After missing the original deadline, banks have agreed a new SEPA start date 39
The French SEPA Committee is overseeing the migration to the European framework 39
EMV and fraud 39
France: aligning with the international standard 40
EMV migration in France 41
The EMV migration in France is another success story 42
Competitor and Product overview 43
Introduction 43
Card scheme market shares 43
Pay now 43
Number of cards in issue 43
Value of transactions 44
Credit cards 45
Number of cards in issue 45
Value of transactions 46
Deferred debit and charge cards 47
Number of cards 47
Value of transactions 48
Card issuer market shares 49
Pay now card issuer market shares 49
Credit card issuer market shares 50
Deferred debit and charge card issuer market shares 51
Competitor developments 52
There has been consolidation in the domestic market over the past five years 52
2002 - Sofinco acquires part of the Finaref cards portfolio 52
2003 - Crédit Lyonnais and Crédit Agricole form a megamerger 53
2004 - Banque Accord acquires Egg France 53
Merger and acquisition activity has been moderate more recently 53
Several domestic players have began to expand abroad 54
Société Générale looks outside of France for further expansion 54
BNP Paribas is another example of a bank expanding in Central and Eastern Europe 55
Alliances and partnerships 55
CB announced it is to allow co-branding alliances and partnerships 55
Foreign players enter into co-branded partnerships in France 55
There are a number of alliances and partnerships among consumer credit companies 55
Product analysis 56
Pay later product design 56
Loyalty programs 59
Caisses dEpargne has a partnership with SMiles 59
Crédit Agricole offers Le Bonus Gold MasterCard 59
Cetelem offers prepaid cards as an incentive for using credit cards 59
Oney offers cashback with its Carte Verte 59
Product innovation 59
Contactless technology trials are starting to take place 59
Banque Populaire launches debit card for women 60
Carte Bleue launches prepaid cards 60
Cetelem offers prepaid cards as an incentive for using credit cards 60
Forecasting the Payment Card Market in France 61
Introduction 61
Forecasting the pay now card market 61
Forecasting the credit card market 63
Forecasting the charge and deferred debit card market 65
Conclusions 67
The French payment card market is sophisticated and is poised for future growth 67
Currently the pay later market is dominated by deferred debit and private label cards 67
However, new legislation and introduction of SEPA Framework are opening new opportunities for
credit card issuers 67
Contactless payments are starting to make their mark 68
Supplementary data 69
Market context 69
Forecasting the payment card market in France 73
Definitions 74
Affinity card 74
Co-branded card 75
Credit card 75
Deferred debit and charge card 75
EMV 75
EPC 75
ePurse 75
Merchant Service Charge 75
Pay now cards 76
POS terminal 76
Private label cards 76
Methodology 76
Cards and Payments Database 77
Further reading 77
Ask the analyst 78
Our consulting 78
Disclaimer 78
List of Tables
Table 1: GDP per capita for selected European countries, 2006 13
Table 2: GINI Coefficient for selected European countries 16
Table 3: Segmentation of liquid assets in France in 2006 17
Table 4: Main players under each pillar, 2006 29
Table 5: Examples of finance houses, 2003 30
Table 6: Annual fees in the deferred debit card market, 2008 56
Table 7: Fees and APRs applicable to revolving credit cards in France, 2008 58
Table 8: Datamonitors forecast for the pay now card market, 2006-11f 62
Table 9: Datamonitors forecast for the credit card market, 2006-11f 64
Table 10: Datamonitors forecast for the deferred debit and charge card market, 2006-11f 66
Table 11: Population numbers and demographic splits in France and other major European
countries, 2006 69
Table 12: Population over 20 in France and other major European countries, 2006 69
Table 13: GDP at current rates across European countries, 2006 70
Table 14: Real GDP growth rates based on constant rates to 2000, 2002-06 70
Table 15: Inflation in selected European countries, 2002-06 71
Table 16: Penetration level of cards in selected European countries, 2006 71
Table 17: The total number of ATM terminals and the number of people per ATM, 2002-06 72
Table 18: The total number of POS terminals and the number of people per terminal, 2002-06 72
Table 19: Value of transactions made by consumers segmented by payment type, 2002-06 72
Table 20: Fraud losses in France, 2002-06 73
Table 21: Pay now card forecast forecasts indexed to 2006 73
Table 22: Credit card forecast forecasts indexed to 2006 74
Table 23: Deferred debit and charge card market forecasts indexed to 2006 74
Table 24: Current relevant Datamonitor publications, 2007 77
Table 25: Future relevant Datamonitor publications, 2008 78
List of Figures
Figure 1: Country overview, 2006 8
Figure 2: France has the second highest population in Europe, 2006 9
Figure 3: France has one of the lowest proportions of population over the age of 20 in Europe, 2006
Figure 4: France has the third highest GDP in Europe, 2006 11
Figure 5: France has enjoyed a period of positive economic growth from 2002 to 2006 12
Figure 6: The French economy is dominated by the services sector, while the agriculture sector
accounts for 2.0% of economic output, 2006 14
Figure 7: French inflation has been kept at or below 2% per annum in recent years, 2002-06 15
Figure 8: In France direct debits and cheques are preferred methods of payment after cash but pay
later cards are also popular, 2002-06 18
Figure 9: France has the lowest penetration level of cards in Europe, 2006 19
Figure 10: Charge and deferred debit cards dominate the French market, 2002-06 20
Figure 11: Charge and deferred debit and charge cards account for the largest share of total
general purpose card transactions, 2002-06 21
Figure 12: Charge and deferred debit cards were most commonly used cards in 2006 22
Figure 13: Deferred debit and charge cards account for the largest share of transaction values,
2002-06 23
Figure 14: Average transaction values are highest on credit cards, 2002-06 24
Figure 15: The growth in ATM terminals slowed down in 2006 25
Figure 16: The total number of POS terminals has risen steadily, 2002-06 26
            Figure 17: The three pillars of the French banking structure, 2008 27
            Figure 18: Regulatory overview of France, 2008 32
            Figure 19: Total fraud losses have fallen since 2003 but picked up in 2006 41
            Figure 20: Visa holds the leading position in the pay now market, 2002-06 44
            Figure 21: Visa accounts for 78.7% of total pay now card spend, 2002-06 45
            Figure 22: Visa had the largest number of credit cards in issue in 2006 46
            Figure 23: Visa accounts for the majority of transaction values, 2002-06 47
            Figure 24: MasterCard accounts for nearly a half of total charge and deferred debit cards in issue,
            2002-06 48
            Figure 25: MasterCard in the largest deferred debit and charge card scheme in terms of transaction
            values, 2002-06 49
            Figure 26: Crédit Mutuel/CIC is the leading pay now card issuer, 2006 50
            Figure 27: Crédit Agricole is the leading issuer of credit cards in France, 2006 51
            Figure 28: Crédit Agricole is the leading issuer of deferred debit and charge cards, 2006 52
            Figure 29: Main merger and acquisition activities in the French market, 2002-2007 54
            Figure 30: Growth in the number of transactions forecasted to drive the pay now market forward,
            2006-11f 62
            Figure 31: Card usage of credit cards is predicted to be primary driver in the market, 2006-11f 63
            Figure 32: Card usage of deferred debit and charge cards is predicted to be primary driver of
            growth in the market, 2006-11f 65

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