Member Card Spending Continues Slow Climb

PSCU also finds consumers are filling their gas tanks less often.

Paying at the pump. (Source: Shutterstock)

Consumers continued their gradual increase in spending on credit and debit cards during the week ending Sept. 20, but less of their money is going into their gas tanks, according to a PSCU report released Monday.

The St. Petersburg, Fla.-based payments CUSO’s Transaction Trends Update showed debit card spending was 16.8% greater in Week 38 than in the week ending Sept. 22, 2019. It was also slightly ahead of the four-week average gain of 16.5%. The number of debit transactions rose 1.8% for the week, making it the 12th week in a row of gains.

Credit card spending reached three consecutive weeks of positive growth, rising 3.2% for Week 38, which was also slightly higher than its four-week average gain of 2.9%. Transactions fell 3.2%, hovering close to the four-week average drop of 2.8%.

“We saw solid performance overall in Week 38, with notable continued strength in contactless debit,” Glynn Frechette, SVP for Advisors Plus at PSCU, said.

“Credit card spend continued to rebound, achieving its third straight week of positive growth — 10 straight weeks of growth if removing travel,” Frechette said. “We’ll continue to monitor this trend closely, as the extent to which consumers start using credit for living expenses could serve as an economic indicator.”

The Midwest, Mideast (Mid-Atlantic) and Southwest regions showed the highest gains, while the west coast, Rocky Mountains and Hawaii were the weakest.

Credit purchase increases were highest in the Great Lakes (+4.6%), the Mideast (+4.9%), the Plains (+6.1%) and the Southwest (+5.3%) for Week 38. They fell in Hawaii (-8.7%) and the Rocky Mountain region (-0.1%).

Debit purchases were highest in the Great Lakes (+18.1%), the Mideast (+18.4%), the Plains (+18.3%) and the Southeast (+17.3%). Hawaii (+1.3%) continued to show the lowest debit purchase performance.

The PSCU reports use a same-store basis, meaning a member credit union’s results were included only if it also had results for the prior period.

This week’s PSCU report provided some detail on gasoline spending, which made up 4.1% of overall credit purchases and 7.1% of all debit purchases in Week 38.

The report showed payments by two paths: Transactions completed at the pump through Automated Fuel Dispensers (AFD) and transactions completed at cash registers inside the store.

On credit cards, consumers spent 26.2% less at the pump and 0.3% less in the store in Week 38. On debit cards, purchases fell 20.8% at the pump and rose 5% in stores.

Frechette said gasoline purchases are influenced by prices, which remain down. For Week 38, the U.S. average price was 13.9% lower than a year ago.

“Ultimately, while members are buying the same quantity of gas when they visit the gas station as they did earlier in the year (especially given the impact of the drop in fuel prices), the frequency of purchases has changed,” he said. “Over the last four weeks, gasoline transactions on average are down 8.9% for credit and down 2.7% for debit.”