Debit & Credit Growth Has Plateaued, According to PSCU Weekly Report

Following a noticeable rebound in credit and debit card transactions, overall growth has somewhat plateaued, PSCU said in its latest weekly consumer snapshot.

For the week ending Aug. 16, Glynn Frechette, SVP of Advisors Plus at PSCU, noted that card payment volumes pulled back compared to the previous week’s report, with debit card spend rising 14.7% compared to 20% for the week ending Aug. 9. Credit card spend continued its downward trend, dropping 2.2% year-over-year compared to 2% the previous week.

“Card payment volumes pulled back slightly in Week 33, with merchant categories showing mixed results by sector,” Frechette said. “We expect continued fluctuations as consumers establish and adjust to the ‘new normal’ while navigating ongoing uncertainty around both the pandemic and political environment.”

Looking at individual merchant categories, grocery chains, utilities and restaurants all showed positive growth. Consumer goods stores in particular – such as electronic, home, discount and automobile stories – have continued their strong growth: Debit spend was up 32% and credit spend up 17.8%.

The report also noted differences among markets. While overall spend was up 14.8% for debit and down 2% for credit nationwide, some areas saw more growth than others.

The initial eight states or districts hit hardest by the pandemic, including California, New York and Washington D.C., saw debit spend up by 13.8% and have trended very close to the overall U.S. spend for the past seven weeks.

But the states where there were no formal stay at home orders – such as Arkansas, Utah and Wyoming – saw a decrease in both credit and debit spend, and continued to trend under the overall U.S. For the week ending Aug. 16, debit spend was up 6% and credit spend was down 3.6%.