An analysis of consumer credit card spending by the FSS for the first eight months of the year showed that credit card spending−purchase of goods and services and cash advances−came to KRW184 trillion, down KRW10.7 trillion or 5.5% from KRW194.7 trillion during the same period a year earlier. Credit purchase of goods and services totaled KRW111.1 trillion, up KRW9.5 trillion or 9.3% from a year earlier, while cash advances fell KRW16.8 trillion or 19.6% to KRW68.9 trillion as credit card issuers cut back on cash services and canceled card members with poor payment history. Since the first quarter of 2004, the amount of credit card purchase of goods and services has been greater than that for cash advances.

Purchase of Goods and Services

During the Jan.–Aug. period, the amount of goods and services purchased totaled KRW111.1 trillion, compared with KRW101.6 trillion during the same period a year earlier. Consumer purchase of goods and services has increased for four consecutive quarters since the third quarter of 2004.

In May and August, credit purchases totaled KRW14.93 trillion and KRW14.88 trillion, respectively, close to the December 2004 record of KRW14.94 trillion.

Full-Payment & Installment Payment Purchases

Credit purchases paid in full upon the due date have steadily increased since 2002. During the Jan.–Aug. period, purchases paid in full jumped 10.9% from a year earlier. Installment purchases, typically used for durable consumer goods and other high-price goods and services, showed a modest increase of 4.5% during the Jan.– Aug. period.

Credit Purchases by Age Group

By age group, the share of credit card purchases by consumers older than 40 years has risen steadily, while the share of purchases by consumers younger than 30 years has fallen, suggesting that the increase in credit card purchases is being led by older consumers with relatively stable and higher income.

Major Purchases

Figures from 15 of the 178 merchant groups that made up approximately 56.4% of the total credit card sales during the Jan.–Aug. period showed an average increase of 16.5% during the period from a year earlier.

* Please refer to the attached PDF for details.