U.S. Credit, Debit Cards Spending Up 21%
According to TSG, much of the shift in high-growth industries stems from consumer preferences leaning into digital goods, use of cards versus checks, and a rise in of ecommerce spending.
Image by Michal Jarmoluk from Pixabay
Data shows that July year-over-year consumer spending on credit and debit cards was up 21% nationwide, according to new market data published by The Strawhecker Group (TSG), an analytics and consulting firm focused on the payments acceptance industry.
Further, when compared to July 2019 to adjust for the influence of COVID, spending was up nearly 20% when looking at a two-year compound annual growth rate (CAGR).
Various industries contributed to July's credit and debit card two-year growth (2021 versus 2019, two-year CAGR). Car rental agencies was one of the high-performing industries at +48%.
Source: The Strawhecker Group
Among the 250-plus industries that TSG monitors, other high-performing industries included:
- Non-Financial Institutions, including cryptocurrency (+81%)
- Aquariums (+51%)
- Sporting Goods Stores (+48%)
- Video Rental Stores, including streaming services (+41%)
- Grocery, ecommerce only (+38%)
- Retail, ecommerce only (+34%)
- General Construction (+33%)
- Air & Ground Freight, excluding the government Postal Service (+30%)
- B2B – Distributors of Durable Goods (+29%)
"The two-year comparison shows that the tailwinds to the U.S. economy as well as the payments industry are apparent and material,” said Mike Strawhecker, president of TSG. “Increased merchant acceptance and consumer usage when paired with strong economic growth, combine to show attractiveness of these markets. Consumer spending comprises 70% of the United States' GDP, and 70% of consumer spending is electronic. This underscores the point that the payments ecosystem is the backbone of the U.S. and global economies."
Many of the high-growth industries may be benefiting from consumer preferences shifting to digital goods, new volume shifting from check to card, as well as the proliferation of ecommerce spending, according to TSG. In addition, a TSG and Visa study found that 26% of consumers expect to use cash less frequently than they did before the pandemic.
TSG forecasts that the larger industry groups of construction, B2B, personal services (e.g., landscaping services), and utilities will outperform the market in the near-term – driven by consumer demand and the conversion to card payments.
Geographic performance also varied from state to state, with Nevada, South Carolina, Delaware, and Arkansas all having 25%-plus growth when comparing July 2021 to July 2019.
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