They’re heavily favoring debit for routine expenditures while leaning into credit for travel-related spending, according to a recent report from PYMNTS. The analysis, based on data collected in November 2024, highlights how payment habits remain sticky, influenced by factors like convenience for everyday buys and strategic considerations like rewards for larger, less frequent purchases.
The report, titled “How People Shop and Pay,” provides a snapshot of consumer payment behavior across various categories, online and in-store, and delves into the reasons behind their choices. It finds that consumers are much more likely to use debit cards for typical household needs like groceries, retail and restaurant visits, often citing convenience as the primary driver.
Conversely, travel purchases consistently buck this trend, with credit cards being the preferred method, frequently chosen for the rewards they offer. This bifurcated approach underscores the importance for financial institutions and merchants to understand the situational context of payment decisions.
Key findings from the report include:
- As of Novembe, 44.1% of consumers most recently used a debit card to pay for grocery items, compared to 26.3% who used a credit card. This represents a consistent preference for debit in the grocery category over the past 2½ years.
- For travel services, 43.7% of consumers most recently used a credit card, while 26.9% used a debit card. This finding indicates that travel remains an outlier category where consumers are more likely to favor credit over debit or other payment types.
- Consumers are 2.4 times more likely to use a digital wallet for a travel purchase than for a grocery purchase. In November, 25% of consumers used a digital wallet for travel, compared to 11% for groceries. Digital wallet use appears to be correlated with purchases that are less routine and more likely made online.
Beyond payment method preferences, the report also touches on the persistent dominance of in-store shopping for everyday needs, noting consumers were 2.9 times more likely to have shopped in-store for their last retail purchase compared to online.
The analysis further explores the reasons consumers choose specific payment methods, revealing that convenience is the dominant factor for debit use, while rewards drive credit card selection for many.
Finally, the report provides encouraging data points regarding payment transaction health, indicating a 27% decrease in payment declines over the last two years and stable, low rates of consumer-reported fraud in 2024.
