Electronic spending low in first week of December

smartpay, tap and go, contactless, purchase, credit card, paymentRetail spending using electronic cards was low for the first seven days of December compared to the previous corresponding period, according to a Paymark study.

Paymark, which processes more than 75 per cent of card transactions in New Zealand, said retail spending in the country using electronic cards was only 1.2 per cent higher in the first seven days of December than in the same week the previous year.

“The first seven days of December were busy for most merchants, as to be expected this time of year, but the annual growth rate was low,” Paymark announced.

Spending among non-fuel merchants for the week was at $1.2 million, 10 per cent above the January to October weekly average, but it was only 1.2 per cent above spending during the first seven days of December 2017.

Annual growth was highest last week in Palmerston North (7.5 per cent), and Southland (6.4 per cent), low in Auckland/Northland (0.1 per cent and negative in Wairarapa (-0.1 per cent).

Spending growth in the country over the weekend, December 8 and 9, remained low, with non-fuel spending on Saturday only 2.0 per cent above the same Saturday last year and Sunday also up a model 2.6 per cent.

“There is a possibility that annual growth will remain weak this month,” Paymark stated, “but more likely there are two factors shifting the spending pattern this year.”

Paymark said Black Friday’s sales appeared to have brought spending forward.

“Typically, spending builds through the last two weeks of November and the first week of December, then ramps up rapidly in the last couple of weeks ahead of Christmas Day,” according to Paymark.

“This year, the three weeks were again busy but spending in the week of Black Friday was slightly above that of last week.”

Spending on non-food and non-hospitality merchants within the core retail sector was three per cent or $10 million higher three weeks ago.

In the week ahead, according to Paymark, spending will likely increase at department stores, recreational goods shops, electronic shops and clothing stores by 10-25 per cent, to step up even further in the last few days before Christmas.

In the last seven days before Christmas, spending in these stores are expected to experience business that varies between 80 per cent to 180 per cent higher than during an average week from the first 10 months of the year.

Spending at food and liquor merchants is expected to rise to 60 to 70 per cent above average in the last seven days before Christmas.

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