Christmas spending and credit card use during the pandemic

Despite the coronavirus pandemic, holiday spending doesn’t seem to be lower this year compared to the previous ones.

We’re approaching the Christmas holidays, and while we might have all expected to have lower spending this year because of the pandemic, research is proving us wrong. The coronavirus pandemic left many Americans unemployed or reduced the amount of time they’re working, resulting in a reduction of their income. This is probably why the common thought was that this year everyone would have to reduce expenses and in particular the ones related to the Christmas holidays.

Nevertheless, according to the NRF, the American National Retail Federation, many people started holiday shopping before December, and 26% of the consumers have already completed their holiday shopping by the end of November.

“Clothing and accessories are the most popular gift category, according to 54 percent of those surveyed, followed by gift cards/gift certificates (49 percent), toys (37 percent), books and other media (34 percent), and food/candy (28 percent).” - NRF says .

Due to the pandemic restrictions, many people prefer online shopping. Many retailers and businesses had to close their shops for a certain amount of time. To keep the business alive, they have moved their activity online, already in the first half of 2020. The need to adapt to the new situation committing to social distancing, while still providing proper service to customers, is what drove businesses to move fast and build their online stores, or improve their existing online presence.

“It resulted in both Q1 and Q2 showing a terrific boost to e-commerce for many stores, including Gamestop (up 800%), Macy's (up 53%), Kohl's (up nearly 60%) and Ulta (up more than 200%).” - Retail Dive says .

A great role was played by special discounts and offers close to the Christmas holidays. An example is the Black Friday sale taking place every year, the fourth Friday of November. Different brands planned longer Black Friday offers this year, under the name of Black Week. This was a big support for customers in their purchase journey, as they had more time to consider gift ideas, compare offers, and complete their purchase before the end of the promotion.

Credit cards and holiday shopping

As we’re talking about online shopping, credit and debit cards are on top, followed by other online payment methods like Paypal.

“Credit cards (42 percent) remain the top form of payment consumers plan to use this holiday season, followed closely by debit cards (41 percent). Just 15 percent of consumers listed cash as a top form of payment during the holidays, the lowest in the survey’s history and likely related to the coronavirus.” - NRF says .

Unlike the expectations, people don’t seem to want to save money or shorten their budget this year, at least not in these situations. Everyone seems to be willing to start celebrating Christmas early, anticipating the feeling of joy and happiness that this festivity carries every December.

There is also a percentage of people who decide that this is not the right time for saving money, and decide to ask for a holiday loan, or bring credit card debts in 2021.

In a recent survey from the US News we found that “Most consumers said they don’t envision bringing holiday debt into 2021: Only about 7% plan to carry a balance or take out a loan for the holidays”.


2020 brought - and forced - lots of changes, also causing an economic crisis in many countries. This is probably what made everyone expect lower holiday spending for this year. The big and fast changes in retail businesses, with online shopping opportunities and offers responding to the customers' needs caused a positive change of plans. People are not only spending more but also spending in advance compared to the previous year. This is certainly giving businesses the right boost to end the year, helping get into 2021 on the right foot.


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