September card spend figures paint ‘gloomy’ picture as consumers tighten belts

Consumers pared back discretionary spending in September as the summer holiday season wound to a close and cost-of-living challenges mounted, Bank of Ireland’s latest credit and debit card statistics show.

The total value of card spending declined 8 per cent last month from August, broadly in line with the 6 per cent decline observed between August and September 2021. However, spending declined more or less across the board this year, with social expenditure hit particularly hard, painting “a relatively gloomy picture” compared with the summer months, the lender said.

Total card spending increased by 10 per cent to €8.8 billion in August compared to July, which was the highest value in spending since records began, Central Bank statistics published last month indicated. The drops in some areas in September were particularly stark, however. The value of card spending in pubs in September was down 28 per cent from August while the total consumer outlay on restaurants declined 22 per cent.

Consumers also ordered less food from fast food outlets, with spending in that area falling 18 per cent, while the value of transactions in the hotel and resort sector fell 26 per cent as the traditional summer holiday season came to a close.

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Retail outlay was also down, with consumers spending 12 per cent less on clothes than in August. Supermarkets, meanwhile, saw a 10 per cent decline in the value of card spending.

With children returning to school, “it won’t come as much of a surprise” to see September spending statistics indicating that consumers “pulled back a little last month”, said Jilly Clarkin, head of customer journeys and SME markets Bank of Ireland.

No county in the State was spared from belt-tightening. The total consumer outlay in Dublin and Sligo fell 9 per cent and was down by 8 per cent in Cork, Mayo and Limerick.

Irish consumers also spent less money abroad, with the value of transactions in Greece declined 24 per cent, Portugal 22 per cent, and in France and Spain by 19 per cent. Total spending on airlines, meanwhile, fell 8 per cent.

Ms Clarkin said consumers of all ages pared back their spending habits last month, from teenagers to the over 65 per cent. “With consumers currently enduring cost-of-living challenges exacerbated by rising energy prices and stubborn inflation hikes, it will be interesting to see if these more restrained spending patterns continue over the coming months.”