PSCU Holiday Spending Gains Outpace Nation

Members of a select group of credit unions spent 7.9% more in November and December 2019 than they did during the 2018 holiday period, according to PSCU, a St. Petersburg, Fla.-based payments CUSO.

The increase was lower than the 10% increase among a similar group of PSCU-member credit unions from the 2017 holidays to the 2018 holidays, but it was nearly twice the 4.1% increase from 2018 to 2019 recorded nationally among all retailers, excluding restaurants, car dealers and gas stations.

Use of mobile wallets by members of PSCU credit unions rose 116%, with PayPal, Apple Pay and Samsung Pay as the leading choices among consumers.

“Despite six fewer shopping days between Thanksgiving and Christmas in 2019 than in 2018, PSCU owner credit unions saw nearly double the year-over-year market growth rate in sales,” Scott Wagner, PSCU’s EVP and chief revenue officer, said.

“We are pleased that our efforts to help drive sustained growth and an unparalleled experience for our credit unions are helping them continue to outpace the market,” Wagner said.

Wagner attributed part of the performance to its PSCU’s Advisors Plus consulting service, which he said helps credit unions “optimize their portfolios, fuel sustained growth, accomplish their goals and maintain top-of-wallet status with their members.”

Nevertheless, the gain among the PSCU credit unions was smaller than in November-December 2018 when sales rose 10%, with spending rising 12% with debit cards and 6% with credit cards.

The 4.1% gain nationally was welcomed by the National Retail Federation, which compared it to the “weak” 2.1% gain during the 2018 holiday season, when sales were slowed by a government shutdown, stock market volatility and interest rate hikes.

“This was a healthy holiday season, especially compared with the decline in retail sales we saw at the end of the season in 2018,” Jack Kleinhenz, the federation’s chief economist, said.

“Despite a late Thanksgiving and worries about tariffs, the consumer didn’t go away,” Kleinhenz said. “We’ve had months of strong employment numbers, high wages and strong household balance sheets. There’s no doubt that gave consumers a sense of confidence about their ability to spend, and they did their part to keep the economy moving.”

Online and other non-store sales accounted for 23% of the total, up from 21% in 2018, according to the federation.

Among PSCU owner credit unions, debit card growth outpaced credit card growth during the 2019 holiday season. Debit sales volume grew 8.8% year over year and debit transactions grew 7.4%, while credit sales volume and transactions both grew at 6.4%.

The debit preference was consistent with PSCU’s findings from its 2019 “Eye on Payments” study released last October, which showed an increased preference for debit among more than 1,750 U.S. consumers surveyed online in July and August.

Last year’s survey found 48% of respondents said debit cards were their preferred method of payment, compared with 26% selecting credit cards. In 2018, 41% of respondents selected credit cards as their payment form of choice, compared with 32% selecting debit.