ST. PETERSBURG, Fla.–Spending on credit cards continues to decline, while debit card spend continues to move in the opposite direction, according to the latest transaction analysis released by PSCU.
Each week, PSCU’s Advisors Plus and Data & Analytics teams has been releasing year-over-year weekly performance data trends. The latest analysis compares the 18th week of the year, the week ending May 3, 2020, compared to the week ending May 5, 2019.
The PSCU data show:
- Overall credit card spend was down 20.1% compared to the same week last year, and overall debit card spend was up 6.6% year over year. For credit, it is the fourth consecutive week of strengthening results, PSCU noted.
- The impact of the federal government stimulus package is still being seen as the average debit card purchase amount was up 18.2% year over year. For the fifth straight week, PSCU said the volume of overall debit transactions posted improvements. Overall debit transactions finished the week down by 9.8% year over year, compared to being down 11.9% in the prior week.
- The positive trend in consumer goods continued in week 18, with a greater percentage improvement in debit card purchases. In this category year over year, there was a 4.0% increase on credit card spend and an increase of 31.9% on debit card spend for the week ending May 3.
CNP Vs. CP
Separately, PSCU said spending behaviors have changed with “stay at home” orders in place, as card-present (CP) versus card-not-present (CNP) transaction counts and dollars spent have seen a shift. Overall CP transactions and purchases have decreased at a greater pace than CNP transactions and purchases.
Among the additional data points:
- In week 18, Credit CNP transactions account for 55% of overall credit transactions and Credit CNP purchases account for 63% of the total spend.
- Debit CNP transactions account for 36% of overall debit transactions and Debit CNP purchases account for 48% of the total spend.
- As a significant contributor to the CNP category, PSCU aggregated the merchant categories for Amazon to create a comprehensive view. For week 18, Amazon credit purchases are up 51%. Amazon debit purchases are up 135% year over year.
The Eight States
With eight states operating without state-level, governor-issued “stay at home” orders in place, PSCU said the weekly buying patterns for those states closely mimics the overall U.S. weekly spending trends.
For those eight states, credit card spend was down by 12.9%, improving at a greater rate than the overall U.S. Debit card spend was up by 7.0%.
“We are watching the now 43 states who are beginning to ease stay-at-home restrictions by May 8, representing 88.4% of the U.S. population,” PSCU said. “Georgia, which started easing restrictions on April 24, has seen increases in credit purchases in line with the rate of improvement of the entire US, but not accelerated. Credit purchases in Georgia finished week 18 down by 22.9%. Debit card purchases in Georgia were up by 4.8%.”
Other Data Points
- For the states/districts hardest hit by the pandemic (“hot zones”), spending is improving at the same rate as the overall U.S. The credit card spend for California, Connecticut, the District of Columbia, Illinois, Louisiana, Michigan, New Jersey and New York was down 23.9% last week. Debit card spend for these same areas was up 3.2 % year over year.
- Grocery stores/supermarkets continue to show good year-over-year spending behaviors. The week ending May 3 finished at an increased rate of 25.2% over the comparable 2019 week for credit and 23.5% for debit, PSCU said. Debit card usage remains elevated, but not as high as increases that were realized during the peak March weeks of COVID-19 stockpiling. PSCU said the elevated rates are an offset to the negatively impacted Restaurant/Dining sector, in which credit spend was down by 52.6% and debit was down by 28.2%.
Improving Trends
“This week’s data suggests that the consumer is gradually resuming their spend patterns, albeit slowly,” said Glynn Frechette, senior vice president, Advisors Plus at PSCU. “We have seen four consecutive weeks of improving trends for both credit and debit as cards continue to play a critical role for consumers – whether used virtually through card-not-present alternatives or face to face as merchants begin to reopen. While we still have a way to go, underscored by this week’s U.S. jobs report, it is encouraging to see consumers resuming certain aspects of normalcy.”