Card spending growth saw a decline for the week ending August 4th, according to PSCU's Tracking Transactions Trends report (https://www.pscu.com/landingPages/WK31_trend_infographic.pdf) . This coincides with unemployment benefits from the Federal CARES Act being discontinued.
Debit card spending growth was up by 11.9%, which was off from the prior four-week average of 17.9%. Credit card spending declined year-over-year by -4.3%. That's also lower than its four-week average of -2.7%. As it's unclear when any new unemployment stimulus money, from the President's executive orders, will land in the hands of consumers, the trend lower in card spending is likely to continue.
Not surprisingly, contactless payments were up for the same period while cash was down. Contactless payments include mobile wallets and card-not-present (CNP) alternatives. Contactless payments are also referred to as “tap-and-go” transactions.
Contactless debit card transactions represented 12.6% of debt card-present transactions. That's up from 9% of pre-pandemic levels. Contactless debit card transactions represented 9.2% of credit card-present transactions, up from 6.5% of pre-pandemic levels.
Mobile wallet transactions continue their run higher for both debit and credit cards. Across a 31 week period, debit mobile wallet purchases are up 78%. Credit card mobile wallet transactions are also up year-over-year by 48.2%, which is slightly higher than their four-week average of 47.8%. These results are from the following mobile wallets: Apple Pay, Fitbit Pay, Garmin Pay, Google Pay, LG Pay, and Samsung.
In regards to category spend, three areas continue lagging: restaurants, travel, and entertainment with the latter two down by the most. Restaurant debit and credit card spending were down by 1.7% and 24.3%, respectively. Travel debit and credit card spend was down by 30.4% and 58.9%, respectively, while the same for entertainment was down by 37.9% and 53.7%.
Cash use continues to see declines. Cash withdrawals are down 22.9%, which is above the past ten-week average of down 22.6%