Shoppers Choosing Cash Over Credit
There’s a view held by many that the effects of the recession
will last for many years into the economic recovery. The rationale goes that
recent tough times have sobered consumers who now have a better appreciation
of what’s important and are only willing to spend on items that meet their
new definition of value.
Among the lessons tough times have brought is the importance of reining
in debt. For many, that means using credit cards less frequently or not
According to a study by BIGresearch
for the National Retail Federation, the number of consumers who will use
credit cards to buy holiday gifts this year will be 28.3 percent, compared
to 31.5 percent in 2008.
Silvio Tavares, senior vice president of industry
relations for First Data Corp., told The Wall Street Journal, “Consumers
are preferring to use their PIN debit card as compared to credit or even
“Some people are just maxed out on their cards,” Gerri Detweiler, a personal-finance
adviser with Credit.com Inc., told the Journal.
Does a three percent downward shift in credit card usage from last year to
this represent a big shift in consumer purchasing behavior? What are the
implications for retailers should consumers reduce credit card usage?