Card payments sink 20% in March. Bank of Portugal talks of “unprecedented reduction”

  • ECO News
  • 24 April 2020

The number of card payments in March sank almost 20% compared to the same month last year.

The pandemic is causing an “unprecedented reduction in using payment cards”. In March, when the State of Emergency was declared in Portugal because of the coronavirus, payments in this way sank 19.4 percent in number and 10.2 percent in value compared to the same month last year.

This information was provided by the Bank of Portugal (BdP), which stresses that the coronavirus, responsible for Covid-19 disease, “is having a significant impact on the activity of national economic agents, be they consumers, companies, banks or public administration bodies”. “This impact is immediately reflected in the use of payment instruments,” the Bank of Portugal says.

Thus, in March, “167.4 million card transactions were carried out, amounting to 9.2 billion euros”. “These figures correspond to decreases of 19.4% in number and 10.2% in value in relation to the same period of the previous year, explained by the reduction in withdrawals, purchases and low-value operations,” details the central bank.

At the same time, cash withdrawals at ATMs “fell by 31.5% in number and 20.4% in value”, to 25.9 million operations worth 1.9 billion euros. As for purchases, the impact “was less pronounced”. They fell by 19.7% in number and 16.2% in value, for a total of 86.9 million operations of 3.3 million euros.”Due to the limited movement of people, payments in tolls and car parks were reduced by 21.9% in number and 24.5% in value compared to the same period of the previous year,” adds the BdP.

The State of Emergency was decreed on March 19th. Between this day and April 20th, the BdP estimates that “the amount of withdrawals and purchases” has sunk 46%. “On average, the Portuguese will have withdrawn 34 million euros less per day and made 56 million less purchases,” stresses the supervisor. “The reduction in card transactions seen over this period is equivalent to 1.4% of gross domestic product (GDP) in 2019,” points out.

The BdP’s data also confirm that the tourism sector has been highly punished by the Pandemic. “Considering the national economic structure, the effects of the Covid-19 pandemic on tourism are significant. In March 2020, there was a significant drop in the value of purchases and withdrawals made by foreigners in Portugal. It is estimated that 182 million Euros less was spent on purchases and 34 million Euros less on cash withdrawals.”