Amid inflation, Canadians will continue to spend intentionally, making purchasing decisions that align with their financial goals, Interac Corp. Chief Commercial Officer William Keliehor predicts in the new PYMNTS eBook, “What’s Your Plan? Payments Strategies for a Strong 2022 Finish.”
Canadians are feeling the impact of high inflation. The financial pressure on households will continue as we move further into Q4 2022. Interac research shows that nearly nine in 10 Canadians (86%) find their money is not going as far today as it used to. However, that is not stopping them from spending, and we predict this tension will continue, with consumers seeking out the best deals to manage the toll on their wallets. Overall, Canadians will continue to spend intentionally, making purposeful purchasing decisions that live up to their financial goals and personal values.
There may be some anxiety in the payments industry surrounding customer spending pullbacks. Still, Interac transaction data shows Canadians used Interac Debit to conduct nearly 7% more transactions this past summer compared to spring 2022, and the spending amount rose almost 6%. Interac Debit spending at restaurants and eating places has increased by 7%, bars by 15% and theaters by 22% in the summer compared to the spring of 2022.
As Canadians enjoy fewer restrictions than they did during earlier stages of the pandemic, the opportunities and temptations to spend are rising and may continue to do so as the holiday season approaches. But the emphasis will be on finding bargains amid rising prices. According to our research, nearly half of Canadians (47%) now look for deals and sales when shopping. This is reflected in Interac Debit volumes at discount stores, which increased by 7% in the summer of 2022 over the summer of 2021.
The Intentional Spending Trend
The drive to seek out deals supports the larger intentional spending trend, which is very evident in the Canadian market. Many consumers make highly considered purchases that align with what they care about most deeply. The majority (62%) say they want tools that encourage intentional spending.
Time is a critical factor. We see evidence that consumers are taking measures to avoid impulse spending, with more than six in 10 Canadians who practice intentional spending (64%) pausing to think about purchases before making them. When making nonessential purchases, the Interac study shows that taking at least a one-day pause before completing the transaction often leads to increased satisfaction.
Debit remains an important tool in giving Canadians control over their money. Four in 10 (44%) say they are hesitant to use credit and prefer only to spend the money they have.
As we head into this next holiday season, we expect to see shoppers being mindful of their purchases, balancing their individual needs, financial situations and available discounts. Canadians have many options when it comes to paying and moving money, and we’re proud they continue to choose Interac when they need to feel in control of their spending.
Interac has launched Sound Shopping, a new music track that provides a balanced backdrop to the shopping experience, intended to promote mindful spending at a time of financial anxiety. Canadians can try out Sound Shopping for themselves here. Visit Interac.ca to learn more about this article’s data and survey findings.