Total UK sales figures for the first quarter of 2004 were more than twice that of the same period in 2003 – an increase of 123%. During that time, Visa cardholders in the UK spent over £2.4 billion on the Internet.

A big winner has been the retail industry, particularly in the area of food and drink, in which sales have more than trebled. This growth has been helped by a massive rise in people ordering their groceries from supermarkets over the Web, says the card firm.

The UK public spent almost five times as much on insurance, and four times as much on utility bill payments and taxes over the last twelve months, while expenditure on travel is up by 159% since Q1 2003. The popularity of buying books and music is also still strong, with an increase of 116%.

Outside of the UK, all the major European markets experienced healthy e-commerce growth year-on-year. Spain showed the biggest increases (166%), while Italy (144%) and France (140%) have also more than doubled their Internet spend. Germany, already a huge market for shopping online, had 83% growth over the year.

The research comes as Visa prepares for the launch to consumers of Verified by Visa, its online authentication system for protecting shopping online.

Hugo Bottelier, vice pesident of Visa EU, said: "As cardholders expand their retail horizons, it is important that the banks create a secure environment for them to use their payment cards. Initiatives such as Verified by Visa help to make the online environment as safe and secure as shopping in the high street."

Verified by Visa, and the equivalent MasterCard SecureCode system have been taken up by the UK's high street banks, but penetration among the popular Internet-only banks such as Smile, Egg and Cahoot remains weak.