#2168: What Year-Over-Year Transaction Trend Findings During COVID-19 Tell Us About the Future...

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If you've noticed the last few months, Glynn Frechette, SVP, Advisors Plus at PSCU, and his team and been compiling the latest transaction trends report to show how consumers are reacting to life during and now -- almost -- after COVID-19. It's been fascinating to see what percolating and what's falling flat -- along with a few surprises.

Glynn joined us to share what he's seen in the last 20 or so weeks and how he sees those numbers predict what will occur for the rest of the year and going into 2021.

Here are some of the latest trends as of June 9, 2020:
Overall card payment volumes were generally positive for the week, with debit continuing to lead the way.

• Debit card spend was up 16.4%, marking the eighth consecutive week of year-over-year growth and a return to a growth level not seen since the pandemic buying spree in early March. Transactions were down 1.6%, but have shown weekly improvements for ten consecutive weeks.
• Credit card spend was down 7.3% year over year, an improvement over the previous week. Transactions were down 11.8%, but have shown improvements for nine consecutive weeks. The weekly improvements in credit were one of the strongest seen since the early effects of the pandemic in March.

Consumers continue strong usage of card-not-present (CNP) alternatives and appear to be using cash less.

• Debit card CNP volumes continue to show strong year-over-year growth, up 49% for purchases and 46% for transactions. This is the eighth consecutive week of growth above 40% for debit. 
• Credit card CNP volumes were up 13% for purchases, with transactions up 26%.
• Amazon, which spans multiple merchant categories and is a top CNP merchant, had aggregate purchase volume increases of 94% for debit and 50% for credit. 
• Cash withdrawal transactions at the ATM have been down 20% or more for 11 straight weeks, indicating less of a preference and desire for cash. For the most recent week, withdrawal amounts are down 23.8%.   

From a merchant category perspective, trends continue to be mixed.

• Grocery continues to perform well, with purchases up 14.0% for debit and 13.5% for credit. 
• The purchase volume of consumer goods was up 39.2% for debit and 14.5% for credit.  Strong categories of note include Electronics, Home, Discount Stores and Automobile. 
• Travel and Entertainment remain the two most significantly impacted sectors. Travel purchases were down 33.3% for debit and 64.4% for credit, and Entertainment was down 42.8% and 53.2%, respectively. 

Some differences are evident by market, with the “hot zones” underperforming.

• Overall U.S. spend was up 16.4% for debit and down 7.1% for credit.
• The eight states that never issued formal “stay at home” orders saw debit spend up by 16.0% and credit spend down by 5.0%.
• The eight states/districts (CA, CT, DC, IL, LA, MI, NJ and NY) that were hardest hit by the pandemic (“hot zones”) saw debit spend up by 7.1% and credit spend down by 12.8%.

Check it out and let us know your thoughts.