Credit card spending fell in 2011
By UK CreditCards.com
While many have started the new year coming to terms with the fallout of Christmas-fuelled credit card splurges, new research suggests credit card spending was actually down in 2011.
According to financial services company Santander, there was a 4% reduction in customer credit card spending during the 12 months of last year, with the travel industry taking a particularly noticeable hit.
Although the total typical number of transactions made by card users rose by 1% in 2011, the average value of these purchases fell.
"During times of austerity, you'd expect cut-backs to hit non-essential items like holidays and clothes, and our customer data supports this," said Callum Gibson, managing director at Santander Cards. "However, while we've seen a drop in overall spend, people are using their cards more -- as demonstrated by the increase in number of transactions."
Credit card spend shows shifting consumer habits
A breakdown of total credit card spending sheds light on how the priorities of many households in the UK changed last year. Hotels and airlines saw credit card spending fall by 4% and 9% respectively, suggesting many Britons were less eager to pay out on travel in 2011.
On the other hand, spending in restaurants and bars rose by 4%, indicating that smaller luxuries, such as eating out, remained important. The value of petrol station and utilities transactions also climbed by 2% and 3% respectively, most likely as a result of inflation.
Beyond travel, other big losers were department stores, where spending fell by 11%, and sports and toy stores, which took 24% less from credit card transactions last year.
Cashback credit cards
If you're making regular use of plastic, it might be a good idea to compare credit cards currently available on the market and choose one that rewards spending, particularly on everyday items such as groceries and petrol.
Cashback credit cards give you a percentage of the amount you spend on your card back to you as credit, which can be put towards subsequent transactions.
Published: 19 January 2012
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