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    Credit-Card Use for Small Purchases on the Rise

    Report says estimated 45 million Americans would use credit or debit cards for purchases of less than $5.

    NEW YORK -- Consumers' use of credit and debit cards for small amount purchases at the point of sale and online is rising, according to a survey on the small payments market. An estimated 45 million Americans are willing to use credit or debit cards for purchases of $5 or less, up 23 percent from September 2004. Additionally, nearly 20 million Americans ages 12 and older have purchased something online for less than $2 in the past year, up nearly 29 percent from September 2004 and 350 percent from October 2003.

    "Credit and debit cards are steadily becoming a more common method of paying for low-priced goods and services, and not just in the online world," said Matt Kleinschmit, vice president of global survey-based market research group Ipsos Insight. "This suggests that merchants, retailers and card issuers alike could benefit from increased consumer access to this type of transaction, as consumers appear to be increasingly willing to use credit or debit cards in small payment purchases for a variety of items."

    Only 7 percent of respondents who would not use credit or debit cards for small payments indicated they find it easier or prefer to use cash rather than a credit card. The survey examined consumers' spending habits for low-priced items and points to potential new markets for card use. Consumers are interested in using credit and debit cards to pay for coffee and beverages, parking (meters, garage, parking lot), fast-food/corporate cafeteria items and at vending machines/kiosks.

    The survey, conducted by Ipsos Insight and payment systems provider Peppercoin, was a scientific, random sample telephone survey of 1,115 Americans ages 12 and older.

    "Over the past year it has been increasingly obvious that there is a fundamental shift in the payments industry as technology makes it easier for consumers to purchase everyday items in the manner of their choosing," said Mark Friedman, president and CEO of Peppercoin.

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