Credit cards are back — and Amex is leading the charge
While buy now, pay later and debit cards have dominated headlines, venerable American Express has been quietly growing its market share and lending.
For two decades, credit cards have consistently lost market share to debit cards and more recently buy now pay later offerings. But the return of travel and leisure post COVID and increasing need for credit in a constrained economy have underpinned a reversal of the trend.
And most of the momentum in the credit card resurgence is with American Express, which was hit by the end of partnerships with major banks five years ago, and lockdowns which halted travel and dining out during the pandemic years. Amex is now gaining market share both because its customers are big spenders on travel and entertainment and its charge card is used by corporates, utilities and governments.
According to analysis of Reserve Bank data by MWE Consulting, Amex and Diners Club’s share of the value of purchases on credit has grown from 15.3% to 20.3% over the past five years. Visa and MasterCard share — on cards issued by banks — has fallen from 84.7% to 79.7%.
The biggest loser has been ANZ, the first bank to issue a co-branded rewards card in the 90s, whose share of card balances fell 1.4 percentage points to 14.5% over the last four years, down from nearly 20% in the 00s.
