Velera: Republican Donations Drop in August

Credit union members in the Velera payments universe continued to spend more heavily on Democrats this summer, according to its latest report for August.

The Velera Payments Index released Monday showed political spending among credit unions whose credit card and debit payments are handled by the St. Petersburg, Fla., CUSO tilted again more heavily toward Democrats as Republican donations dropped.

Overall donations fell from July to August — slightly for Democrats and sharply for Republicans. Donations had increased from June to July.

June began on the heel of former President Donald Trump’s May 30 conviction on 34 counts of fraud and ended with President Joe Biden’s June 27 debate debacle with Trump.

Events swirled in July:

• July 13: Trump was grazed by a bullet in attempted assassination attempt in Butler, Pa. The shooter and one person in the crowd were killed.
• July 15-18: Trump was nominated at the Republican Convention in Milwaukee.
• July 21: Biden dropped out of the race and endorsed Vice President Kamala Harris.

Harris was nominated at the Democratic Convention Aug. 19-22 in Chicago.

In August, member spending by credit card on Democrats was an average of $42.35 (-2% from June), compared with $28.37 (-14%) on Republicans. By debit card, spending was $25.66 (-5%) on Democrats and $19.77 (-19%) on Republicans.

In July, the average credit card donation to Democrats was $43.38, up 9% from June, and $32.92 (+2%) to Republicans. Average debit donations were $27.09 (+8%) to Democrats and $24.51 (-2.1%) to Republicans.

“With less than two months remaining until the presidential election on Nov. 5, the race appears to be very close and within most polls’ margin of error,” Velera’s report said. “As seen in the 2020 election cycle, we expect the volume of transactions and purchases to continue increasing until November and will continue to monitor activity in this merchant category through the 2024 presidential election cycle.”

Velera’s average credit card account balance stood at $2,940 at the end of August, up 3% from a year earlier. Velera’s total credit card balance grew 4.2% from August 2023.

The credit card delinquency rate was 2.47% on Aug. 31, up 36 basis points from a year earlier—the smallest difference from year-ago rates so far this year. The delinquency rate was also down 6 basis points from June.

Callahan’s Peer Suite showed that Velera’s predecessors — PSCU and Co-Op Solutions — were near the top of credit card processors in December, just before their Jan. 1 merger. Together they handled nearly 10 million of the 25.3 million cards held by credit unions.

Callahan identified vendors for 1,610 credit unions, which held 89% of the nation’s total $82.4 billion in credit card debt held by 3,011 credit unions as of Dec. 31.

PSCU ranked No. 2. Its 493 credit unions held $21.8 billion (26%) of the nation’s credit card debt behind TSYS Payment Solutions with $29.4 billion (36%). Callahan found TSYS of Columbus, Ga., handling credit cards for only three credit unions, but it was enough because its clients include Navy Federal Credit Union, which alone held $29.3 billion of that credit card total.

Co-op Solutions was No. 4 with 143 credit unions holding $5.2 billion (6%) of the nation’s credit card debt, behind Visa DPS, whose 66 clients held $5.5 billion (7%).

Besides the small amount of political spending tracked by Velera, overall spending through the CUSO continued to roughly bracket national retail spending and the Consumer Price Index, which was 2.5% in August.

The Census Bureau reported Tuesday that retail spending, excluding automobiles and parts, rose 2.7% in August from a year earlier. At Velera, spending fell 0.8% by credit and rose 6.2% by debit.

About a third of debit growth came from money services, including CashApp, Venmo and Zelle.

Spending by some key categories also bracketed national spending:

• Grocery store spending rose 2.5% in August from a year earlier, Census reported. At Velera, spending rose 1% by credit and rose 4% by debit.
• Gasoline spending fell 6.3% in August from a year earlier, Census reported. At Velera, spending fell 11% by credit and fell 6% by debit. Gasoline showed the largest drops at Velera as the average price of a gallon of gas on Sept. 9 was $3.24, down 15% from a year earlier.
• Spending at restaurants and bars rose 5.1% in August from a year earlier, Census reported. At Velera, spending rose 4% by credit and rose 6% by debit.

The Velera Payments Index is based on data from credit unions that have been processing payments with Velera since January 2022. This month’s report encompassed 3.3 billion transactions valued at $167 billion of credit and debit card activity in the 12 months ending Aug. 31.