Velera-Managed Debit Cards Surge in May
But the payments CUSO reports credit card spending remains flat compared with a year earlier.
Debit card spending in May handled by the nation’s largest payments CUSO grew at a pace double that of inflation and overall U.S. retail spending, while credit card spending was barely changed from a year earlier.
The Velera Payments Index released Monday showed spending rose a scant 0.1% by credit while rising 6.4% by debit.
The U.S. Bureau of Labor Statistics (BLS) reported Tuesday that retail spending, excluding automobiles and parts, rose 3.1% in May from a year earlier. The U.S. Bureau of Labor Statistics reported June 12 that inflation grew at a 12-month pace of 3.3% in May.
For the past year, Velera has seen payments rising faster by debit than credit cards. Since October, credit card spending changes have ranged from a 0.4% drop over 12 months to 1.1% gains. Over the same eight months, debit growth was 3.2% to 6.6%.
May data from Velera, Census and BLS also showed:
- Grocery store spending rose 2.4% in May from a year earlier, while inflation for food at home rose 2.1%. At Velera, spending rose 3% by credit and fell 3% by debit.
- Spending at restaurants and bars rose 5% in May from a year earlier, while inflation for food away from home grew 1.0%. At Velera, restaurant spending rose 4% by credit and rose 5% by debit.
- Gasoline spending rose 2.3% in May from a year earlier, while gasoline prices rose 2.2%. At Velera, spending rose 2% by credit and was unchanged by debit.
Velera’s report said the gains in gasoline spending were mainly caused by spending at convenience stores, which includes non-fuel purchases. Growth in true gasoline purchases at Automated Fuel Dispensers was modest, with credit up 0.1% and debit up 0.7%.
Velera’s credit card delinquency rate was 2.34%, up from 1.86% a year earlier and unchanged from April.
The average credit card balance among accounts managed by Velera was $2,904 on May 31, up $77 or 2.7%, from a year earlier and up $5, or 0.2%, from April.
The total balance of credit card handled by Velera rose 5.1% from a year earlier and 0.5% from April.
The Velera Payments Index was based on data from credit unions that have been processing payments with Velera since January 2022. It encompassed 3.2 billion transactions valued at $160 billion of credit and debit card activity in the 12 months ending May 31.