Credit Union Member Card Spending Continues Gains

Credit union members whose credit and debit card transactions are aided by PSCU continued to improve, largely at the expense of cash, according to a PSCU report released Monday.

The St. Petersburg, Fla.-based payments CUSO’s Transaction Trends Update showed spending by debit card in the week ending Oct. 11 (Week 41) was 17% higher than the week ending Oct. 13, 2019, and slightly better than the four-week average gain of 16.4%.

Credit card volume rose 3.8% — its sixth consecutive week of growth and on pace with the four-week average gain of 3.5%.

Spending on services was especially strong, rising 20.7% for Week 41, compared with a gain of 11.7% for Week 40. Credit spending rose 10.9%, compared with Week 40’s 7.8% gain.

“Travel remains the sector with the biggest opportunity for improvement,” the report said. For Week 41, purchases were 49.6% lower than a year ago on credit cards and down 15.5% on debit cards.

“Both debit and credit purchase volume continued to show overall strength in Week 41, with the services sector showing notably strong performance,” PSCU SVP Glynn Frechette said.

In the four weeks ending Sept. 13, debit card spending was 16.9% greater than a year earlier, while credit card spending rose 2.3%.

Regional patterns also continued. The strongest regions for the week were the Great Lakes (+5.4% for credit, +18.4% for debit), Plains (+5.6% for credit, +16.4% for debit) and the Southeast (+5.6%, +19.3% for debit).

The weakest credit card purchase areas were Hawaii (-4.4%), New England (-2.9%) and the Rocky Mountain states (-0.5%). The weakest for debit spending were the Far West (+11.7%) and Rocky Mountain (+10.5%) regions.

Cash withdrawal transactions at the ATM remain down. The amount of cash withdrawn in the week ending Oct. 11 was 8.3% lower than a year. The average for the four weeks ending Oct. 11 was a decline of 19.4%.

Continued gains were shown for contactless “tap-and-go” transactions via dual interface cards, and mobile wallet transactions via Apple Pay, Fitbit Pay, Garmin Pay, Google Pay, LG Pay and Samsung Pay.

Card not present (CNP) transactions represented 51.5% of credit card spending, up from 45.3% a year earlier, while CNP was 42% of debit purchase, up from 34.7% a year earlier.

PSCU’s “deeper dive” for Week 41 explored the utility sector, which currently makes up 5% of overall credit purchases and 10% of all debit purchases.

Consumers have been spending more on utilities by debit card and credit card for most of the year, finishing Week 41 up 18.9% from a year earlier by debit and up 5.9% by credit.

The growth in debit purchases has come from spending in the “Computer Network & Info Services” category, which currently makes up 20% of utilities. The top merchants in this category are Amazon and Microsoft (Xbox, Office365).

Average four-week spending levels for the period ending Oct. 11 were:

• Cable, Satellite & Pay TV: $46.47 credit and $48.47 debit.
• Computer Network & Info Services: $34.49 credit and $39.48 debit.
• Telecom Services: $111.56 credit and $96.20 debit.
• Utilities (Electric, Gas, Water): $132.20 credit and $128.90 debit.
• Telecom Equipment: $127.45 credit and $101.18 debit.