Nationwide: £45 contactless limit boosts supermarket spending

Business

The new £45 ceiling on contactless card payments probably caused supermarket spending to rise over the late summer and early Autumn period, and not panic buying, according to new data.

Nationwide Building Society said the £15 increase – along with the greater use of cards and frequent restocking of cupboards – helped multiply spending at British supermarkets.

Compared to the same time span in 2019, total expenditure in them rose by 23 per cent to £1.5billion from August 10 and October 4 and were up by over 10 per cent against the eight weeks before the lockdown.

Though supermarket spending has risen, Nationwide says it is not evidence of panic buying

Both total and average spending per transaction was at its greatest in the final week of August when the late summer Bank Holiday weekend was happening.

This was still more than £23million lower than in the third full week of March when Britons stockpiled goods in anticipation of the coronavirus lockdown. The group also said there was ‘no sudden or marked weekly spikes’ across the period.

Commenting on the findings, Nationwide’s Head of Payments Mark Nalder said:

‘Our analysis shows that while average spend in supermarkets is up overall, and by a reasonable margin, there have not been the same weekly surges in supermarket spend that were seen in the run-up to the national lockdown.

‘We’re focused on delivering convenient, secure and easy-to-use products and services which put our members in control of their money at every step. This has led to growth in digital payments, which have really helped people pay safely and conveniently at an uncertain time.’

Nationwide also disclosed that transactions in hospitality venues skyrocketed in August after the Eat Out to Help Out Scheme was introduced, giving people discounts of 50 per cent on food and soft drinks up to £10.

Transactions in hospitality venues skyrocketed in August after the Eat Out to Help Out Scheme was introduced, giving people discounts of 50 per cent on food and soft drinks up to £10

The initiative was used over 100 million times during the month, and Nationwide says it helped to bolster spending on Mondays, Tuesdays and Wednesdays in restaurants and pubs by between at least a quarter and 30 per cent.

But it also expanded on the final three days of the week when the scheme did not apply, though by smaller margins: 10 per cent on Friday, 13 per cent on Saturday and 17 per cent on Sunday.

Nalder remarked: ‘Eat Out to Help Out was a resounding success while it lasted although as our data shows, once it ended spend across food venues followed suit.