The Spanish card payments market is forecast to grow by 8.9% to reach €402.6bn ($435.4bn) in 2024, supported by a constant consumer shift towards electronic payments, according to GlobalData, a leading data and analytics company.

GlobalData’s Payment Cards Analytics, reveals that card payment value in Spain registered a growth of 22.5% in 2022, driven by a rise in consumer spending. The value is estimated to have registered a growth of 18.1% to reach €369.8 billion ($399.8bn) in 2023.

Ravi Sharma, Lead Banking and Payments Analyst at GlobalData, commented: “Spain is gradually moving towards the digitalisation of its payment infrastructure, supported by a high-banked adult population, partly due to citizens’ right to a basic account, and the expansion of its point-of-sale (POS) infrastructure. The growing acceptance of payment cards by retailers and the advent of contactless technology are set to reduce the share of cash within the economy.”

Cash remains an integral part of the Spanish consumer payments landscape, particularly for lower-value transactions. However, there has been a consistent decline in cash usage, while electronic payment methods have witnessed an increase. This is supported by a well-developed payment infrastructure with over 52,000 POS terminals per one million inhabitants in Spain, which is amongst the highest compared to many of its European counterparts.

The outbreak of the COVID-19 pandemic accelerated the rise in contactless payments in the country, thereby contributing to growth in overall card payments. According to the Study on the payment attitudes of consumers in the euro area (SPACE) in 2022, released by the European Central Bank (ECB), contactless payments in Spain accounted for 67% of all card payments at POS, in terms of volume, in 2022. The share was 66% when it comes to transaction value.

In 2021, it became illegal for consumers to make cash payments over €1,000 to businesses

The cap on cash transactions is also pushing the use of card payments in the country. As of 2021, it became illegal for consumers to make cash payments of more than €1,000 ($1,073.2) to businesses, which means all amounts above the limit will have to be paid using electronic mode.

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Sharma concluded: “The Spanish card payments market, which was affected by the pandemic, returned to a growth trajectory with impressive growth in subsequent years, supported by a rise in economic activity and consumer spending. However, an uncertain economic environment and rising inflation pose challenges for faster growth. The Spanish card payments market is forecast to grow at a compound annual growth rate (CAGR) of 6.4% between 2024 and 2028 to reach €515.9bn ($557.8bn) in 2028.”