Poland is one of the most advanced and innovative markets in Europe, offering consumers broad access to the latest technology in electronic payments.

Nevertheless, cash remains very popular, accounting for 61.5% of the total payment transaction volume in 2017. Payment card use is rising as consumers enthusiastically embrace new technology, moving from cash to payment cards to contactless.

Although cash remains the dominant means of payment in Poland, there was huge growth in the volume of debit card transactions during the period 2013- 2017. The figure more than doubled as consumers preferred debt-free payments and avoided unnecessary expenditure.

Government initiatives to promote paperless and cashless transactions and the launch of new mobile POS technology will boost the adoption of electronic payments in the country.

The government has also been encouraging businesses to open bank accounts for employees, and salaries are now paid into bank accounts. It is also focusing on using electronic modes of payment to distribute pensions and other retirement benefits.


Debit cards drive market

The growing banked population has led to rising debit card penetration.

According to the World Bank, Poland has made substantial progress in terms of financial inclusion, with the percentage of the Polish population aged 15 or above with a bank account rising from 75.4% in 2013 to 83.1% in 2017.

The high banked population and consumers’ general aversion to debt have made debit cards the preferred card type in Poland. Polish consumers are gradually switching from cash to debit cards, and used them an average of 117 times for POS transactions in 2017 – almost double the amount for pay-later cards.

The rise in contactless card acceptance has supported this trend. A number of banks including PKO Bank Polski, mBank, Bank Zachodni WBK and Bank Pekao offer contactless debit cards.

Pay-later cards

The growth of pay-later cards was halted at the end of 2010, as non-performing loans rose.

The T-Recommendation issued by the Financial Supervisory Commission in Poland took effect in August 2010, restricting consumer access to bank loans and consumer credit; consequently, consumers faced more stringent scrutiny when applying for credit cards.

The change in regulation imposed additional requirements on banks to check the creditworthiness of new customers. Issuers also deactivated inactive cards, resulting in a decline in the number of credit cards in circulation.

As the recommendations forced banks to adopt a cautious stance towards card issuance, they turned their attention to increasing credit card use. Consequently, reward credit cards have started to gain traction, with the majority of issuers such as Bank Pekao, PKO Bank WBK, and ING Bank Śląski offering benefits such as flexible repayment options, a 56-day interest-free credit period, discounts, reward points, and cashback offers.

Banks are also offering an instalment facility to convert large-value purchases into monthly instalments. For example, Bank Pekao offers a Mastercard-branded credit card, Flexi, that enables cardholders to convert purchases in the range of PLN300–5,000 ($71.70–1,194.40) into three interest-free instalments.


E-commerce growth

The Polish e-commerce market almost doubled between 2013 and 2017, in terms of transaction value.

The relatively low cost of operating is one of the primary reasons attracting several foreign e-commerce giants to Poland.

With the growing availability of various alternative payments such as PayPal, Blik, and Android Pay, and with banks launching exclusive mobile apps and virtual cards for online shopping, e-commerce is expected to continue its robust growth over the forecast period.

Low prepaid penetration

With the growing popularity of contactless cards, especially among the young population, banks in Poland are designing contactless prepaid cards for this segment.

For instance, PKO Bank Polski offers the Mastercard-branded Speeder PKO Junior contactless prepaid card for children under 13. Cardholders can also opt for a prepaid contactless sticker. The card can be used to make both in-store and online payments, and funds can be loaded through online transfer or by paying with cash at any of the bank’s branches.

In view of the growing e-commerce market, banks are also offering prepaid cards targeting online shoppers. For example, mBank offers a Visa-branded prepaid card called Virtual eKarty. Similarly, ING Bank Śląski offers the Visa Virtual card, which can be ordered online and costs $4.80. For customers with a Direct 18–26 account, the card is issued free of charge.

The growth of municipal cards is also expected to drive the prepaid card market. Municipal cards are issued by PKO Bank Polski, in partnership with Mastercard. The municipal card is designed to provide local governments, universities, and other institutions with a convenient means of disbursing benefits. A bank account is not required to obtain the card. Beneficiaries can also withdraw money from ATMs and make payments at any POS that accepts Mastercard in Poland.