December spending trends: Pause and reflect

CO-OP Payments Trends Report (Spending Data from December 1-31)

RANCHO CUCAMONGA, CA (January 19, 2022) — 2021 ended on a high note, as consumers overcame concerns with the recent rise in omicron cases to drive spending over the extended holiday shopping season back to pre-pandemic levels. This behavior signals a strong start to the new year once consumers and retailers are able to recover from the current winter surge.

As they have for much of the year, December’s key economic reports were a mixed bag. Jobs growth stumbled with only 199,000 new payrolls added for the month, even as the unemployment rate fell to 3.9%, the lowest level since the start of the pandemic. Wages increased by 4.7%, a positive sign, whereas inflation grew by 7% in December, the fastest increase since 1982.

Taking a deeper dive into CO-OP’s member credit union credit and debit portfolio data for December, numerous merchant classifications showed month-over-month increases. This included strong growth in the Amazon/Bookstores, Digital Goods, Grocery, Medical, Retail and Travel categories, along with more mixed growth in categories such as Education, Computers, Office, Home Improvement and Sports & Recreation. The Dining & Entertainment and Gas categories were flat, while Lodging was the only category that fell in both debit and credit for the month.

Here are some of the key spending trends CO-OP’s SmartGrowth consulting team are watching closely this month:

#1: Retail Finishes Year Strong

Despite an early and extended holiday shopping season that began back in mid-fall, December retail spend stayed robust. Although the Commerce Department reported that retail sales declined by 1.9% for the final month of the year, overall sales for the fourth quarter grew a healthy 17.1% over the same period in 2020.

CO-OP credit union spending data showed increases of 18% in debit transaction count and 17% in debit transaction amount, while credit posted growth of 21% and 23%, respectively, versus November.

December’s credit spending in the Retail category was even more impressive, with transaction counts up by 60% and amounts up by 53% over the prior December.

These results align closely with industry trends, as Mastercard SpendingPulse data showed that spending during the 2021 holiday season rose 8.5% compared with the same period in 2020. Moreover, in-store sales rose by 2.4% over 2019, while online sales exploded by 61.4% over the pre-pandemic period.

#2: Inflation Drives Grocery Spend Higher

In December, the Grocery category grew moderately in transaction count within both the credit and debit portfolios. However, transaction amounts grew by double-digits in both channels. Both COVID and inflationary effects contributed to this trend, as many consumers were content to eat more meals at home as omicron cases rose rapidly following the Thanksgiving holiday. In contrast, the Dining & Entertainment category was basically flat for the month.

“Inflation will continue to be the hot topic in 2022 across most anything consumers buy,” said John Patton, CO-OP Senior Payments Advisor. “Because of this, I expect more families will cook at home and the spend on weekly groceries will naturally rise. During this inflationary period, credit unions need to focus their marketing messages on highlighting value and financial benefits.”

#3: Despite Ups and Downs, It Was A Very Good Year in Credit

Although it was sometimes hard to tell on a month-to-month basis, credit spending enjoyed a strong rebound in 2021 – not only in comparison to the depths of 2020, but also as compared with results from 2019, with many merchant categories surpassing their pre-pandemic levels. This trend indicates that consumers are returning to previous spending behaviors and are comfortable making purchases both large and small on credit and paying off balances over time.

The total number of transactions in 2021 grew 22% over 2019, and outpaced 2020’s transaction totals by 2%. In transaction amount, the story was very similar.

“Not surprisingly, credit rebounded in 2021 from its significant 2020 declines in both transaction counts and amounts,” said Beth Phillips, CO-OP Director of Strategic Portfolio Growth. “All key categories surpassed their 2019 pre-pandemic levels with the exception of Travel (-29%) and Lodging (-1%). In addition, the total amount of transactions in 2021 grew by 35% over 2019, and outpaced 2020’s total by 10%.”

Among specific merchant categories, Digital Goods grew most rapidly, increasing by 200% in count and 231% in amount over 2019, and 69% in count and 71% in amount over 2020.

For interchange, Gas was the big category winner in 2021, with a 132% increase over 2020 and 104% increase over 2019.

The Retail category grew in transaction count by 50% over 2020 and 61% over 2019.

Computers remained a top category in 2021 with an increase in count of 113% over 2019 and 60% over 2020.

Amazon/Bookstores transaction count grew by 6% over 2020, but also posted the biggest deceleration in growth following the prior year’s 55% annualized increase. Unsurprisingly, the biggest losers over the past couple of years are found in the travel-related categories, as Travel purchase counts declined by (-34%) and Lodging dropped by (-11%) from 2019.

Month-Over-Month Category-Level Spending (Comparing December 2021 to November 2021) Please note that the category spending below reflects month-over-month comparisons (rather than year-over-year), i.e., compares December 2021 with November 2021, rather than December 2021 and December 2020.

Credit Debit
Count Amount Interchange Count Amount Interchange
Category Monthly Change Monthly Change Monthly Change Monthly Change Monthly Change Monthly Change
Amazon/Bookstores 31% 30% 31% 28% 29% 29%
Digital Goods 8% 2% 3% 5% 3% 5%
Dining and Entertainment 0% 3% 3% 0% 1% 1%
Education -14% 8% 6% -17% 5% -5%
Gas 0% -1% 0% -1% -1% -1%
Grocery 7% 14% 14% 6% 15% 7%
Lodging -6% -9% -10% -6% -4% -5%
Medical 7% 7% 8% 5% 5% 5%
Retail 18% 17% 18% 21% 23% 19%
Travel 20% 13% 13% 31% 27% 28%
Computers -3% -14% -14% 18% 12% 13%
Office 18% 12% 16% -22% -10% -13%
Campers & Camping 15% 4% 6% -3% -6% -4%
Home Improvement -11% -3% -3% 39% 38% 34%
Sport/Recreation -4% -8% -7% 22% 22% 20%

More information on the CO-OP SmartGrowth Consulting Team can be found here.

About CO-OP Financial Services

CO-OP Financial Services is a payments and financial technology company whose mission is ensuring the success of the credit union movement. CO-OP payments solutions, engagement services and strategic counsel help credit unions optimize member experiences to consistently provide seamless, personalized multi-channel offerings, while delivering secure, sophisticated fraud mitigation service. For more information, visit


Bill Prichard, APR
Director, Public Relations
CO-OP Financial Services
(909) 532-9416

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