Introduction

Payment Cards in the Czech Republic is an invaluable guide to one of Eastern Europe's quickest growing payment card markets. Created using a combination of primary and secondary research, this report provides statistics on market size, market shares and card acceptance. It provides an overview of regulation, competitor activities and product innovation. It concludes with market forecasts.

Scope

The focus of the report is on consumer payment cards, as opposed to commercial products Data and analysis provided on debit cards, credit cards, and deferred debit and charge cards The report parameters extend to issuance only. Merchant acquiring and card processing are not covered Historic market data is presented from 2001 to 2005, with forecast data presented to 2010. Competitor market shares are presented for 2005

Highlights

The payment card market in the Czech Republic is small but growing rapidly. At the end of 2005 there were 7 million cards in issue, of which less than ten per cent were revolving credit cards. However, credit cards are the fastest growing segment of the market, with the number of revolving credit cards growing by more than tenfold since 2001 Pay now cards are the most frequently used type of card, In 2005 the average pay now card was used 32 times, compared to the average revolving credit card, which was used just 12 times. The level of card acceptance in the Czech Republic has grown rapidly in the 2001 to 2005 period but still remains low in comparison to Western European card markets. At the end of 2005 there were 194 people for every POS and 3,005 people for every ATM

Reasons to Purchase

Access detailed information about the Czech payment card market, including cards in issue, transaction volumes and transaction frequency Understand the structure of the Czech payment card market, including recent regulatory developments and their impact on the market Learn Datamonitor's forecasts to 2010, specifying card numbers, transaction values and transaction volumes, broken down by card type

EXECUTIVE SUMMARY 11
INTRODUCTION 12
What is this report about? 12
Scope of the report 12
Structure of the report 12
MARKET CONTEXT 14
Introduction 14
Country overview 14
Demographics 14
Economy 16
The Czech Republic still has a large industrial sector 18
Structural reform in the Czech economy 19
GDP growth has been steady 19
Inflation 20
Distribution of income (Gini coefficient) 21
Market size 22
Market penetration 22
Cards in issue 23
Number of transactions 25
Frequency of use 26
Value of card transactions 28
Average transaction values 29
Card acceptance 30
POS statistics 30
ATM Statistics 31
Market structure 32
The central bank - Ceska Narodni Banka (CNB) 32
Interbank processor 32
Commercial Banks 32
Building societies 33
Credit and savings cooperatives 33
Privatization has changed the face of the Czech banking sector 33
The influence of foreign investors gave the market a much needed boost 35
Consequently, the Czech banking market is dominated by foreign players 35
Regulatory environment 37
Regulatory bodies 38
The Czech National Bank (Department of Banking Regulation and Supervision) 38
CNB Banking Supervision uses two basic supervisory methods - off-site surveillance and on-site examinations. 39
The Office of Supervision of Savings and Credit Cooperatives 40
Banking associations 40
Czech Banking Association (CBA) 40
Payment Card Association (BCA) 40
Credit bureaux 41
The Central Register of Credits (CRC) 41
Czech Banking Credit Bureau (CBCB) 42
Recent regulatory developments 42
European Consumer Credit Directive 42
Key issues 44
Fraud and EMV 44
The Czech Republic is advanced in EMV migration 44
SEPA 44
COMPETITOR AND PRODUCT OVERVIEW 47
Card scheme market shares 47
Pay now cards 47
Cards in issue 47
Value of transactions 48
Credit cards 49
Cards in issue 49
Value of transactions 50
Deferred debit and charge cards 51
Cards in issue 51
Value of transactions 52
Card issuer market shares 53
Pay now cards 54
Credit cards 55
Deferred debit and charge cards 56
Product analysis 57
Pay now products 57
Revolving credit products 57
Introductory offers are uncommon 58
APRs continue to fall 58
Deferred debit and charge cards 59
Product features 60
Loyalty progams are slowly being introduced 60
Partnership cards are becoming more common 61
Product innovations 62
Komercni Banka has introduced the E-Card 62
Mulit-functional cards have been introduced 62
FORECASTING THE PAYMENT CARD MARKET IN THE CZECH REPUBLIC 63
Forecasting the pay now market 63
Forecasting the credit card market 64
Forecasting the deferred debit and charge card market 66
SWOT Analysis 67
Strengths 67
Weaknesses 68
Opportunities 68
Threats 68
APPENDIX 70
Supplementary data 71
Market context 71
Definitions 74
Affinity card 74
Credit card 74
Deferred debit/charge card 75
EMV 75
EPC 75
ePurse 75
Interchange 75
Merchant Service Charge 76
Pay now cards 76
POS Terminal 76
Research methodology 76
Cards and Payments database 77
Future readings 78
Datamonitor's custom research capabilities 79
Cards & Payments Team contact details 81
How to contact experts in your industry 82
List of Tables
Table 1: Population distribution by age group in the Czech Republic, 2005 15
Table 2: GDP per capita for selected European countries, 2005 18
Table 3: Inflation rates in a number of major European markets, 2001-2005 21
Table 4: GINI coefficients in Europe, 2001-2003 22
Table 5: Ownership statistics of the Czech banking sector, 2001-2005 36
Table 6: Major foreign players participating in the Czech banking market, 2005 37
Table 7: Fees for pay now cards in the Czech Republic, 2007 57
Table 8: Rates and fees for a selection of Czech credit cards, 2007 59
Table 9: Prices and benefits of deferred debit and charge cards in the Czech Republic, 2006 60
Table 10: Datamonitor's forecast of the pay now card market, 2006f-2010f 63
Table 11: Datamonitor's forecast of the credit card market, 2006f-2010f 65
Table 12: Datamonitor's forecast of the deferred debit and charge card market, 2006f-2010f 66
Table 13: Population numbers and demographic splits in the Czech Republic and other major European countries, 2005 71
Table 14: The percentage of people over the age of 20 in the major European countries, 2005 72
Table 15: GDP at current prices across major European countries, 2005 73
Table 16: Real GDP growth rates, 2001-2005 73
Table 17: POS terminals and population per terminal in the Czech Republic, 2001-2005 74
Table 18: ATMs and population per ATM in the Czech Republic, 2001-2005 74
Table 19: Current relevant Datamonitor publications 78
Table 20: Future relevant Datamonitor publications, 2006 79
List of Figures
Figure 1: An overview of the Czech Republic, 2005 14
Figure 2: In terms of population, the Czech Republic is a small European country, 2005 16
Figure 3: The Czech Republic has one of the smallest GDPs in Europe, 2005 17
Figure 4: The Czech Republic has a larger industrial sector than most European countries, 2005 19
Figure 5: The Czech Republic has seen steady economic growth, 2001-2005 20
Figure 6: The Czech Republic has less than one card per person, 2005 23
Figure 7: Pay now cards dominate the payment card market in the Czech Republic, 2001-2005 25
Figure 8: Pay now cards account for the majority of transaction volumes, Czech Republic, 2001-2005 26
Figure 9: Pay now cards have the highest number of transactions per card per year, Czech Republic, 2001-2005 27
Figure 10: The value of card transactions has more than doubled, Czech Republic, 2001-2005 28
Figure 11: Deferred debit and charge cards have the highest average transaction value, Czech Republic, 2001-2005 29
Figure 12: The Czech POS network has grown rapidly, 2001-2005 30
Figure 13: The Czech ATM network has expanded, 2001-2005 31
Figure 14: Supervisory bodies and professional associations in the Czech Republic, 2005 38
Figure 15: Visa has become the dominant pay now scheme, Czech Republic, 2001-2005 48
Figure 16: Visa accounts for the majority of pay now transaction value, Czech Republic, 2001-2005 49
Figure 17: Most credit cards are issued on the Visa scheme, Czech Republic, 2001-2005 50
Figure 18: MasterCard now accounts for the majority of credit card transaction value, Czech Republic, 2001-2005 51
Figure 19: American Express is the dominant scheme for deferred debit and charge cards, Czech Republic, 2001-2005 52
Figure 20: American Express continues to account for the majority of deferred debit and charge card transaction values, Czech Republic, 2005 53
Figure 21: Ceska Sporitelna is the biggest issuer of pay now cards in the Czech Republic, 2005 54
Figure 22: Ceska Sporitelna is the biggest issuer of credit cards in the Czech Republic, 2005 55
Figure 23: Komercni Banka is the main issuer of deferred debit and charge cards, Czech Republic, 2005 56
Figure 24: The National Geographic Card, Czech Republic, 2007 61
Figure 25: The Komercni Banka UNIcard, Czech Republic, 2007 62
Figure 26: The pay now market will grow steadily, Czech Republic, 2005-2010f 64
Figure 27: The credit card segment is forecast to grow rapidly, Czech Republic, 2005-2010f 65
Figure 28: The deferred debit and charge card market is set to decline, Czech Republic , 2005-2010f 67
Figure 29: The Czech Republic payment card market, SWOT analysis, 2006 69
Figure 30: Datamonitor's core consulting capabilities 80