As the country’s economic and financial crises has deepened, we are heading intensely towards a cash society in all shapes. In fact, paying by cash is likely becoming the only accepted payment method by the local suppliers as well as by all the Lebanese traders. In this context, the annual report published by the Central Bank of Lebanon shows that the number of debit and credit cards in circulation are on a steady decline since the start of the crisis.
Undoubtedly, the number of credit cards has sharply decreased by 34.51% YOY to reach a record level of 364,210 cards by end of year 2020. This precise decline can be linked to the fact that Lebanese banks ceased on granting facilities for their customer base by the start of the crisis.
In the same token, the number of debit cards, overall, went down by 0.22% from 1,854,044 cards by December 2019 to 1,849,910 cards by December 2020. It is important to note that the number of debit cards granted for the non-resident customers has dropped significantly by 8.91% YOY due to banks international limit reduction of debit cards.
Concerning the number of branches of the Lebanese commercial banks, they retreated by 66 branches in the year of 2020 to reach 992 branches at the end of year 2020, particularly those that are rented by the banks. In tandem, the total number of automated teller machines (ATMs) slumped by 6.44% going from 2,003 machines to 1,874 machines for the same period. Furthermore, the number of electric point of sales (POS) notably decreased by 11.83% reaching 33,442 machines by the end of year 2020.
Overall, these drops can be justified by several reasons. The closure of some bank branches and the destruction of some ATMs during the protests, in addition to the bank restrictions on withdrawals and equally the urge of business owners to receive their money in cash only. Though figures are not yet available, we expect these negative trends to continue in 2021.
Evolution of the number of credit cards, debit cards, ATMs and POS:
Source: BDL annual report, BLOMINVEST