Ryan Kemp, director of retail at TransUnion (formerly Callcredit) comments on the ONS Retail Sales Index: “In the three months to October, retail sales increased by 0.4% when compared to the previous three months; slowing down after a strong summer. This should come as no surprise, as this period has historically been a quiet time for consumers, and the current economic and political uncertainty will be further dampening spend.
“However, we can anticipate an increase in spending in the coming weeks, with Black Friday, Cyber Monday and Christmas just around the corner, driving sales both online and in-store. The festive season will be a cause for celebration for retailers, who have endured a difficult year. However, for credit providers, there needs to be an element of caution.
“Many shoppers may be tempted to splurge beyond their means under the guise of bargains and sales, and this will only add to the already high level of consumer debt. Lenders should be performing robust credit checks and have an awareness of contributing factors to a customer’s financial stability, such as problem debt and income, so that they can carry out accurate affordability assessments, particularly during this busy time when over-spending is rife.
“As spending increases, so too does cyber-crime, with many consumers falling victim to fake vouchers and discount codes in a bid to get the best deals available, unwillingly giving out their personal data to fraudsters. Retailers and lenders need to be vigilant in spotting signs of fraudulent activity, and must take steps to educate consumers in safe shopping practices such as researching stores online to ensure they are legitimate, and not to make purchases on public WiFi.
“2018 has been a trying year in terms of cyber-security and consumer debt, but with better affordability practices and fraud awareness, consumers, lenders, and the retail industry alike can end the holiday season on a high.”