THE WAY WE SHOP NOW
EFTPOS purchases: up 19%
Debit card purchases: up 18.9%
EFTPOS withdrawals: up 4%
Credit card purchases: up 1.9%
Electronic transfers: up 1.3%
ATM withdrawals: down 1%
Credit card cash advances: down 9%
Writing cheques: down 15%
Reserve Bank, July on July
We are abandoning credit cards but embracing plastic as never before. New Reserve Bank figures show the average credit card balance slipped $28.50 in July, the biggest mid-year slide since records began 17 years ago.
But our love affair with plastic grows stronger by the month. We reached for debit cards a record 204 million times in July, up 18.9 per cent on the year before. We reached for credit cards 131 million times, up only 1.9 per cent.
These days we fairly rarely use credit cards to borrow cash, fronting up to banks for cash advances 2 million times in July, down from a peak of 3 million in 2007. By contrast we swiped cards at retail EFTPOS terminals a near-record 226 million times, up from 181 million a year earlier. We took out cash as we swiped 21 million times, up from 20 million. We took out cash a further 1.6 million times in solo transactions, unaccompanied by purchases, another record.
“It’s a new conservatism and its here to stay,” said Commmonwealth Securities economist Savanth Sebastian. “We are scouring around for the best ways to keep our budgets in the black.”
“Some of it is concern about the cost of debt. Interest rates don’t seem super-high, but they are biting.”
We’re also withdrawing from ATMs less often in a continuing flight from the introduction of fees... We took out cash 70 million times in July, down from 71 million the year before.
We wrote just 21 million cheques in the month, down from a peak of 50 million per month early last decade. We transferred cash electronically 211 million times, up from 208 million a year before.
In separately released forecasts Delloite Access describes the financial year just past as “disastrous” for retailers - the worse in 20 years.
“Income growth was solid enough, though it suffered a major setback from last summer’s floods and cyclone, says Access director
David Rumbens in the report. “But the more important theme has been less willingness to spend, or at least less willingness to spend on retail. The only category showing good performance is so-called other retailing, which includes newsagents and chemists. Elsewhere the landscape is barren with food sales in real terms at the same point as a year ago, while clothing and footwear, department stores and cafes and restaurants have all lost ground.”
“Retailers now face the prospect of going from bad to worse. Share market falls have eroded wealth and seen consumer confidence plummet further. The implications of the financial market volatility and further deterioration of consumer confidence in August are yet to be seen in the retail sales data. When they do appear its unlikely to be pretty. The next few months look like being subdued at best.”
Published in today's SMH and Age
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