UK is Europe's card capital as cheque usage slumps

The use of cheques in the UK fell 9.3 per cent last year as the number of stores not accepting them rose.

Figures from Association of Payment Clearing Services (Apacs) show there were 1.6 billion cheques written last year – compared with five billion debit card transactions.

The march of the card continued, with the UK now having 73.2 million debit cards and 71.8 million credit cards.

Tesco and Marks and Spencer are now set to stop allowing customers to pay by cheque, following the lead of Sainsbury's, Argos and Debenhams.

Meanwhile, new figures from Datamonitor show the UK heads the European card league – with each Brit having on average 2.8 payment cards, including 1.4 credit cards.

This compares with one card per person in France, 1.6 cards in Germany and 2.3 cards in Norway (the UK's closest rival).

Andrew Fabricius, Datamonitor financial services analyst, said: "In the UK consumers use debit cards for day-to-day spending much like their European counterparts, but are increasingly using credit cards as borrowing tools, applying for new credit cards to transfer an outstanding balance and take advantage of interest free offers.

"In most other countries, consumers do not view credit cards as a borrowing tool and as a result they are not so popular."

Despite tails of the credit crunch making borrowing tougher, the number of credit cards in the UK is set to remain stable in 2008 - rising just 0.2 per cent.

Mr Fabricius added: "The high penetration of credit cards in the UK is due to consumers being happy to pay for goods and services by using credit and enjoy the flexibility of paying for purchases over a longer period of time.

"By contrast, consumers in Germany have a more disciplined attitude towards expenditure and as a result credit cards are far less popular."