‘Card spending grew in 2022, yet rising prices forced Brits to be more selective’

Consumer card spending rose in 2022 while spending on groceries slipped marginally as the lifting of all Covid-19 restrictions encouraged Brits to shop more in-store, eat and drink out, and book holidays abroad.

According to latest data from Barclaycard, consumer card spending increased 10.6 per cent year-on-year in 2022. Spending on essential items grew 6.3 per cent in 2022. This lift was largely due to a 28.3 per cent rise in fuel spend, driven by surging petrol and diesel prices and increased car use, as life returned to normal following almost two years of Covid-19 restrictions.

Despite rising inflation and higher food prices, spending on groceries was down -0.1 per cent overall compared to 2021. This is likely due to the growing number of consumers who say they have been actively looking for ways to reduce the cost of their weekly shop, with 69 per cent reporting this was a focus in November. The most popular methods to obtain greater value from grocery shopping this year were paying closer attention to the prices of specific items (55 per cent), cutting down on one-off treats (51 per cent), and switching to unbranded or supermarket-branded versions of popular items (51 per cent).

Face-to-face spending at supermarkets was up 2.1 per cent, whereas online spending fell -12.8 per cent – a sign that shoppers were returning to pre-pandemic habits and visiting supermarkets more frequently after work or while out and about, instead of buying most of their groceries online.

Surging energy prices caused purse strings to tighten, with the average customer spending 32.9 per cent more on utilities than last year. While 2021 saw the continued rise of online shopping, a full year of open high streets in 2022 meant face-to-face retail spending returned to growth, rising 8.3 per cent, while online retail spending declined -12.2 per cent.

The retail sector overall saw an increase in the total number of card transactions (up 5.0 per cent), however, the total amount spent was down -0.8 per cent, indicating smaller basket sizes amid cost-of-living squeeze.

Esme Harwood, director at Barclaycard, said: “The lifting of all Covid restrictions meant card spending was up overall compared to last year. Hospitality, leisure and travel all received a boost as Brits made up for lost time by socialising with friends and jetting off on holidays.

“However, the cost-of-living squeeze has clearly impacted the retail sector. Consumers have had to rein in spending on purchases like subscriptions and home improvements, as well as reduce their basket sizes in general.

“As these inflationary pressures continue, all categories are likely to face further headwinds in 2023. However, I am optimistic that both consumers and businesses will continue to find ways to adapt and respond to these challenges, as they did throughout the pandemic.”