Consumers trade in cash for plastic
By David Peregrino
El Paso Times
Yliana Rodriguez doesn't feel secure stepping outside her door unless she's packing some plastic.
The recent University of Texas at El Paso graduate is one of millions around the world using plastic payment cards for nearly every transaction, saying goodbye to checkbooks, and pocketfuls of bills and change.
"I pretty much always use my Wells Fargo debit card," said Rodriguez, 23. "It's quicker, and I check my balance online. And it keeps me from spending more money than I have to. I just spend the exact amount I need."
Be they debit (check cards), credit or prepaid cards, the use of plastic continues to boom, industry analysts say.
In 2001, payment cards were used for 26.4 percent of personal purchases in the United States, up from 18.5 percent in 1994, according to a study by the leading payment-card brand Visa U.S.A.
Meanwhile, the use of cash and checks continued to decline. And last year, for the first time, Visa check card transactions outpaced Visa credit card transactions in the United States.
Several factors are driving the popularity of payment cards, said Visa spokesman Kenny Thomas. They include the obvious, such as the safety and convenience of carrying a card rather than wads of cash.
But other growth factors include the popularity of Internet shopping, which nearly always requires some kind of payment-card account, and more choices in the kinds of payment cards, such as prepaid gift cards and payroll cards, Thomas said.
"Another factor is we're giving consumers more places to use their cards. There are more channels open to them," Thomas said.
Fast-food restaurants have been among the latest to embrace payment cards. Sonic Drive-Ins and some Jack in the Box restaurants already accept plastic. Recently, McDonald's announced about a quarter of its 13,300 U.S. stores would begin accepting payment cards this year.
A 2000 study by industry group Global Growth said about 8 percent of fast-food restaurants accepted payment cards. In 2002, that number grew to 14.5 percent.
"Sometimes it comes down to who will accept cards when I decide where I'm going to go for lunch," Rodriguez said. "If I have no cash, I won't go to a place that doesn't accept plastic," she said.
The University of Texas at El Paso, with its Miner Gold student identification card, is a microcosm of what future card use will be for the rest of the country.
The card is an all-purpose device, said Barbara Woo, manager of the Miner Gold Card office.
Students swipe it across electronic locks to open doors to labs and the Miner Village residential complex. Students also use the card to pay for meals at food services in the Student Union building, and for books and supplies at the campus bookstore.
A microchip on the front of the card can be uploaded with up to $50 for purchases at vending machines, copiers and — coming soon —washers and dryers.
And plans are in the works to make the Miner Gold card accepted at nearby restaurants.
