MADISON, Wis.– The Filene Institute has released a report which examines how cardholders make the decision to use their credit or debit card at point of sale. Credit unions like other card issuers have a direct stake in the decision since credit card interchange is generally significantly higher than debit card interchange.
The Institutes' study, Debit vs. Credit: How People Choose To Pay, found that while very little appeared to separate consistent credit card users from consistent debit card users in terms of income and total spending, cardholders who primarily use debit cards appeared to have lower credit scores and carry higher interest credit cards.
The report's authors suggested that the classification of predominant users of each card is firm enough that credit unions could find it useful to further segment their membership along those lines.
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