Consumer finance comment on ONS retail figures

“December was always going to be a chilling prospect for retailers, many of whom spent the month wrestling with supply chain disruption, an inflationary headache and related cost-of-living crisis, and a Covid wave that saw footfall dive 18% below pre-pandemic levels. All that disruption was enough to dissuade shoppers from filling their baskets, and their stockings, to the same extent as the previous month, or indeed the year before.

“Our own data suggests that consumers used point of sale finance options to bolster their spending power around 2% less often than in December 2020, but the value of items bought with store credit climbed by 3.5%. These are incremental changes in the grand scheme of things but do suggest that economic uncertainty is driving shoppers to use credit for bigger ticket items, with more manageable repayment terms.”

Brian Flesk, Head of Retail at Hitachi Capital Consumer Finance