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PSCU Payments Index – February 2022 Edition

February 16, 2022 – Today, PSCU – the nation’s premier payments credit union service organization (CUSO) – published the February edition of the PSCU Payments Indexthe goal of which is to provide information and insights to help financial institutions make informed, strategic decisions on the road ahead.

In this month’s iteration, we look at several macroeconomic indicators affecting consumer preferences and behaviors, including the Omicron variant and unemployment rate, among other factors. The Consumer Confidence Index decreased in January, impacted by challenges from rising prices and the ongoing pandemic, while supply chain disruptions and market shortages are now expected to continue through 2022. The Consumer Price Index (CPI) increased 0.6% in January, to 7.5% – its highest point since February 1982 – according to data released by the Labor Department on Feb. 10. And, despite the continued pandemic-related headwinds, consumer spending remained strong throughout the month of January. This month, we present a Deep Dive into Food – the combined Grocery and Restaurant sectors.

“Entering 2022, the evolving path of the pandemic remains evident,” said Norm Patrick, vice president, Advisors Plus Consulting at PSCU. “While consumer confidence dipped in January for the first time since before the holiday shopping season, consumer spending remains very strong. Credit card purchases outpaced debit once again, with the Travel and Entertainment sectors reporting the highest overall growth in consumer spend. As we look at Food purchases in this month’s Deep Dive, the total spend has grown – in part due to rising prices and continued bulk buying – but the spend mix continues to shift, falling back to more of a pre-pandemic pattern.”

A sampling of key takeaways from the February report includes:

  • Consumer spending was again very strong for both credit and debit purchases in January, with growth in credit continuing to outpace debit. Consumers eager to return to pre-pandemic habits posted strong spending growth in the Travel and Entertainment sectors. Year-over-year growth in debit purchases was softened by the record debit growth at this time last year, fueled by federal government stimulus disbursements in Dec. 2020 and Jan. 2021.
  • The average credit card balance for January 2022 was $2,736 – marking the first time since the start of 2019 that the year-over-year average credit card balance has not dropped.
  • Growth in CNP purchases within the Food sectors, this month’s Deep Dive topic, has accelerated compared to pre-pandemic annual results, with added growth when comparing 2021 to 2020 in the Restaurant categories. Consumer acceptance of online food purchases and in-person pickup or delivery has become more mainstream.
  • The CPI-U for January increased to 7.5%, the highest point since February 1982. The pace of increase for January was the same as December’s increase of 0.6%. Food prices rose 7% with Restaurants, Fast Food and grocery stores all contributing to the increases. Interest rate hikes are expected to begin in March.
  • Stronger-than-expected job growth was recorded for January, while the unemployment rate stayed relatively flat from December at 4%.

The full report is available for download here or can be shared as a PDF upon request. Additionally, feel free to subscribe here to receive updates when the PSCU Payments Index is published each month.

Contact:

Peyton Burgess
On behalf of PSCU
919-815-2915