Annual figures released today by Worldline NZ show consumer spending growth in 2024 was the slowest it’s been in half a decade.
Consumer spending through Core Retail merchants - excluding hospitality - in Worldline NZ’s payments network reached NZ$36.30 billion in the full year of 2024, which is up 0.8 per cent on 2023.
While the number of transactions in 2024 increased, the average transaction size declined by 0.6 per cent to $50.35.
The new figures also show that despite strong Boxing Day sales, the month of December continued the downward trend of 2024 with a decline in card spending of 0.7 per cent, dominated by major centres Auckland and Wellington being down 2 per cent.
According to peak body Retail NZ, the new data shows that the retail sector continued to be under pressure as 2024 drew to a close.
“Retailers have advised us that the Christmas rush was late arriving and that although Boxing Day sales were busy, they might not make up for the slow start to December,” Retail NZ CEO Carolyn Young said.
“Profitability will continue to be a major challenge for retailers as they finish off what has been a difficult 2024.”
Worldline NZ’s chief sales officer Bruce Proffit said while consumers may have made more transactions through retailers than the previous year, the annual underlying spending growth - or the actual increase in dollars spent - was the lowest in the last five years.
Proffit added that the average transaction value recorded through Worldline’s network also declined in 2023, which was likely due to a combination of merchant discounting and fewer consumer purchases of high-value products.
“If we look back at 2020, that was clearly a tough year both for consumers and retailers with the onset of Covid, which led to a drop in the number of transactions made through Worldline NZ’s network that year,” Proffit said. “However, prices also increased sharply in 2020, which meant the dollars spent back then did increase.
“Last year, the key driver was less money spent, with the likely key factor being the ongoing adjustment of budgets to the inflationary period that emerged in 2020.”
Proffit said the budget pressure is more evident in the hospitality sector where the average transaction value declined in 2024.
Consumer spending through hospitality merchants in Worldline NZ’s payments network reached $11.39 billion in the full year of 2024, which is down 2.7 per cent on 2023.
Regarding monthly figures, Proffit said the drop confirms the pattern previously reported for pre-Christmas spending. “That is, the traditional end-of-year spending spree did occur but was not enough to push spending above year-ago levels in the major cities.”
Alongside annual spending declines in Auckland and Wellington, the Canterbury region was down 0.4 per cent, with the largest drop in the smaller Marlborough region by 2.2 per cent.
Annual spending growth did occur in some regions, with the highest rates seen in West Coast (up 4.2 per cent) and Whanganui (up 3.4 per cent).