New York, December 28,2005--Visa USA on Wednesday said its cardholders spent $32.2 billion in the week leading up to Christmas and Hanukkah, 26.9 percent more than in the same period in 2004.
Retail card volume, which includes such things as department, electronics and home improvement stores but excludes supermarkets and gas stations, surged 21.4 percent to $13.1 billion, San Francisco-based Visa said.
The largest U.S. credit card association attributed the increases to greater use of cards at the expense of cash and checks, higher employment levels and sinking gas prices, which had surged to record levels after Hurricane Katrina struck the U.S. Gulf Coast in late August.
Consumer debit card use for the week ended December 25 jumped 32.8 percent to $15 billion, while credit card use rose 19.1 percent to $14.9 billion.
It was the first time consumers spent more on debit cards than on credit cards in the holiday season, though for all of 2005 credit card use is higher, Visa spokesman Kenny Thomas said.
Spending on Visa-branded cards for the period from October 31 to December 25 rose 17.7 percent from a year earlier to $232.4 billion, Visa said.
Wayne Best, Visa's economist, said the data show that consumers are "generally resilient and comfortable with their financial position."
The Conference Board on Wednesday said its index of U.S. consumer sentiment rose in December to a four-month high of 103.6 from a revised 98.3 in November. Analysts on average had forecast 101.8.
Visa said last Friday was its busiest holiday season shopping day, as overall sales volume topped $5.9 billion. Retail volume totaled almost $2.5 billion, compared with nearly $2.6 billion on the day after Thanksgiving.
Wal-Mart Stores Inc., (WMT.N: Quote, Profile, Research) also said last Friday was its biggest shopping day of the year, as more people than expected took off from work to buy last-minute gifts.
Visa said most retail segments posted double-digit percentage card sales gains last week, led by a 27.6 percent increase in home and garden sales. Online spending that week surged 48.4 percent to $2.7 billion, Visa said.
Earlier, SpendingPulse, a data service that is part of MasterCard International, Visa's biggest rival, said U.S. holiday retail sales excluding autos and gas rose 5.2 percent from a year earlier on a seasonally adjusted basis for the Nov. 25-Dec. 17 period.
