NEW YORK (11/14/08)--Debit card use is expected to climb 13% in 2008, to $1.2 trillion, according to the Nilson Report. The trend will impact credit unions in more ways than one. The steep increase in debit use compares with a 3% increase in credit card transactions, totaling $1.9 trillion. Mastercard and Visa reported a 17.5% hike in debit card transactions, compared with 7.45% for credit card transactions during 2007, said Nilson (San Antonio Express-News Nov. 11). Visa Inc. says debit card use could surpass credit card use this year. Roughly 58.9% of credit unions overall offer debit cards, according to the Credit Union National Association's Credit Union Service Profile for December 2007. But among credit unions with $50 million or more in assets, debit cards are offered by 96% to 99.6% of credit unions, depending on the asset category, said the profile. There's still plenty of room to grow debit card use. Larger credit unions that offer debit cards can work on getting a larger debit penetration in their membership. Smaller credit unions may be hard put to offer the sophisticated debit services unless they collaborate with third parties. Also noting the increasing debit card usage is SAS, which makes software that tracks consumer purchase. Members and other consumers already are using their debit cards, SAS told the Express-News. Some members are using debit as a budgetary measure as card companies place more restrictions on card use in the tightening economy. Leslie Baldwin, a member of Security Services FCU in San Antonio, told the newspaper that her family cut up its credit cards and is using cash and her credit union debit card, PayPal and online bill paying services. The trick is to keep track of the expenditures on debit. According to the Consumer Federation of America, consumers paid $17.5 billion a year for unauthorized overdraft loans that stemmed from not keeping track of their debit card purchases. Overdraft fees at the nation's largest banks averaged almost $35 last year. Business Week (Oct. 29) reported that banks are scrambling to boost the profitability of their debit cards. It notes that overdraft fees have evolved. Banks used to deny credit to consumers who don't have enough funds in their accounts. Now most large banks approve the debits but charge a fee if the debit "bounces." They've also made it easier to prompt penalties. Consumers no longer have a "float" between the charge date and when they deposit money into the account. "Banks have turned this into a major source of revenue," CFA told the publication.