Consumption confidence among Chinese bankcard holders firmed as more used their cards to pay for non-necessity expenditure as food prices fell in April, an industry index showed Monday.

The bankcard consumer confidence index grew to 86.8 in April, up 0.08 point from March. But it was flat on a year-on-year comparison, said China UnionPay Co yesterday.

The index has risen for three straight months. It tracks expenses of the card users, including 200,000 individuals in affluent cities. They frequently use the cards to pay for 90 percent of their expenses.

The higher the index the more bankcards are used to pay for non-necessity expenditure such as luxury goods and travel.

"Bankcard holders are increasing non-necessity consumption as the decline in food prices frees them to do more shopping apart from basic needs," the Shanghai-based company said in a statement.

Data from the Ministry of Agriculture showed the agricultural products wholesale index fall to 180.3 at the end of April from the 184.9 at the beginning of the month.

The one-year benchmark savings rate rose to 3.25 percent after a 0.25 percentage point hike in April. Big banks faced a 20.5 percent reserve requirement ratio after the latest 0.5 percentage point rise last month.

China's plan to raise the individual income tax threshold to 3,000 yuan (US$462) from 2,000 yuan now also boosted willingness to spend on consumption.

More consumers use bank cards as convenient payment options. Chinese are also big spenders overseas, prompting smaller lenders like China Guangfa Bank and China Merchants Bank to team up with Ctrip, hotels, shops and airline companies to tap the demand for travelling and spending.

Banks are also finding that credit cards are a growing revenue channel. China Guangfa Bank said its profit from its 10 million credit cards rose 80 percent in 2010.