Sixth Week of 2021 Sees ‘Strong’ Credit/Debit Volume, PSCU Reports; Plus a Deeper Dive Into the ‘Goods’ Sector

ST. PETERSBURG, Fla.–The sixth week of 2021 was “strong” for debit and credit card purchases by credit union members, according to the latest analysis released by PSCU.

The company’s Advisors Plus and Data & Analytics teams released its latest year-over-year weekly performance trends, in this case comparing the sixth week of the year (the week ending Feb. 7, 2021) with the week ending Feb. 9, 2020. 

“Growth was strong in Week 6 for both debit and credit purchases, with credit performing well above the previous four-week average,” said Glynn Frechette, SVP, Advisors Plus at PSCU. “In this week’s deeper dive, we revisit the Goods sector, where we continue to see healthy increases across multiple retail categories. Amazon continues to experience exceptional year-over-year growth, further supporting the significant increase in ecommerce activity since the onset of the pandemic.”

The Overall Numbers

According to PSCU:

• Debit card spend is up 21.6% in Week 6 and debit transactions finished up 3.6%. Debit purchases were lower than the previous four-week average of +25.8% and transactions were also lower than the previous four-week average of +7.6%.
• Credit card spend in Week 6 finished up 8%, well above the previous four-week average of +3.4%. Transactions finished up 0.1%, higher than the previous four-week average of -3.2%.

Digital Payments & Card Not Present

Consumers continue to show strong adoption of digital payments, including contactless, mobile wallets and Card Not Present (CNP) alternatives, while using less cash, PSCU said.

The CUSO reported:

• Contactless “tap-and-go” transactions via dual interface cards continue to show strong consumer acceptance, with debit showing notable strength. Debit contactless transactions as a percent of Card Present activity on contactless debit cards have more than doubled from around 8.4% in January 2020 to 18.2% in Week 6 of 2021.
• Contactless credit transactions have also more than doubled, growing from 6.5% to 13.6% of Card Present activity on contactless credit cards in the same timeframe.
• “We continue to view these results as conservative, as the ratio considers the proportion of contactless activity to all card present transactions, not just those able to be tapped,” PSCU said.
• Mobile wallet (i.e. “Pays”) transactions and purchases for both credit and debit cards continue to show good growth with Card Present activity. Debit mobile wallet purchases finished Week 6 up 57.4% year over year, lower than the previous four-week average of +68.2%, PSCU reported. Credit mobile wallet purchases are up 46.7% year over year, higher than the previous four-week average of +43.3%. PSCU said the results represent six supported mobile wallets: Apple Pay, Fitbit Pay, Garmin Pay, Google Pay, LG Pay and Samsung Pay.
• “We continue to see more volume conducted via Card Not Present (CNP) transactions. For credit, 57.5% of purchase volume and 46.5% of transactions are CNP,” the company said.
• For debit, 47% of purchase volume and 32.5% of transactions are CNP. Purchase mix has held steady and is up 7.3 percentage points year over year for credit and 7.4 percentage points for debit. Transaction mix also remains steady, up 10.5 percentage points for credit and 8.1 percentage points for debit year over year.
• Cash withdrawal transactions at the ATM are down year over year. For the most recent week, the number of cash withdrawals was down 17.4%, below the previous four-week average of -15.1%. 

Merchant Spend

• PSCU reported from a merchant category perspective, the start of 2021 continues to show strong results in Goods, Utilities, Services and Grocery Stores, while year-over-year performance for Travel and Entertainment remain depressed. Drug Store performance has seen a steady decline in the past few weeks. (All percentages are year-over-year weekly comparisons).
• Purchases in the Goods sector remain strong, up 27.3% for credit and 34.6% for debit; Utilities spend was up 22.3% for debit and up 13.1% for credit; Service spend was up 27.0% for debit and up 14.5% for credit; Grocery spend was up 15% for debit and up 23.0% for credit.  
• PSCU said sectors trying to return to positive growth include Drug Stores, which are down 2.2% for debit and up 1.3% for credit, and Restaurants, finishing up 1.4% for debit and down 14.2% for credit.
• Travel remains depressed, down 15.5% for debit and down 48.3% for credit.

Regional Spend

Using segmentation data from the U.S. Bureau of Economic Analysis (BEA), PSCU said its analysis found:

• Overall U.S. spend was up 8% for credit purchases. The Southeast (+12.8%) and Southwest (+11.8%) finished as the strongest regions for Week 6. The Mideast (-0.1%) and New England regions (-3.9%) had the lowest credit purchase performance.
• Overall U.S. spend was up 21.6% for debit purchases. The Southeast (+24.3%) and Plains (+23.8) finished as the strongest regions for Week 6. Hawaii (+13.9%) and the Mideast (+15.5%) region had the lowest debit purchase performance.
• PSCU noted its Weekly U.S. State/Territory Analysis is available at www.PSCU.com/COVID19, where it ranks U.S. states and territories by year-over-year performance for debit purchases, credit purchases and ATM transactions.

The Deeper Dive

In its latest deep dive, PSCU revisited the Goods sector. Among the findings:

• The largest portion of the Goods sector is comprised of Miscellaneous Stores, including furniture, home furnishings, appliances, sporting goods, liquor, pet and hobby stores. For Week 6, this makes up 33% of debit purchases and 34% of credit purchases. Purchases are up in this category 37% for debit and 29% for credit in Week 6, PSCU said.
• Retail stores represent 30% of debit purchases and 26% of credit purchases within the Goods sector. Within this category, home improvement, hardware, landscaping and discount stores have experienced increased spending. For Retail Stores, debit purchases are up 37%, lower than the prior four-week average of +49%. Credit purchases are up 30%, above the prior four-week average of +27%.
• As a significant contributor to the CNP category, PSCU said it aggregated the merchant categories for Amazon to create a comprehensive view. Amazon debit purchases were up 70% year over year and credit purchases were up 50%. For the prior four weeks, debit purchases were up 83% and credit purchases were up 48%.
• Clothing Stores, one of the most affected categories within the Goods sector, have seen improvements and are now enjoying positive year-over-year growth, PSCU reported. For this category, debit purchases outperform credit purchases in finishing Week 6, up 18% for debit and up 3% for credit. The previous four-week averages are +38% for debit purchases and +3% for credit purchases.
• Goods Sector Card Not Present (CNP) activity remains well above the prior year. For Week 6 in the Goods sector, debit CNP purchases are 41% for 2021 compared to 33% in 2020. For credit CNP purchases, the results are 57% for 2021 compared to 47% in 2020.