Coronavirus hits spending on Chinese cards in NZ, but leap day gives a boost

Wednesday, 4 March 2020

Spending on Chinese-origin bank cards is down almost 40 per cent in February, revealing the financial impact of coronavirus, data from payments company Paymark shows.

While spending from China-issued cards has been in decline throughout 2019, January saw a 19.8 per cent increase before the 39.3 per cent drop in February.

The sharp drop in February on spending from China-issued cards was across a range of retailers, though spending at chemists was an exception and increased 4.4 per cent.

Total foreign-issued credit card spending was up 12.7 per cent in February, in part due to the leap year effect of having an extra day of spending, Paymark said.

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In total, $348 million was spent in February through Paymark with credit cards that could be identified as foreign-issued, up 12.7 per cent on the previous year.

Across all foreign-issued cards, spending was down in February within Otago (-2.6 per cent), Southland (-2.8 per cent) and West Coast (-10.2 per cent).

Spending on Chinese-origin bank cards is down almost 40 per cent in February. (File photo)

Foreign-issued card spending also dropped in these regions amongst accommodation merchants, as was the case in Canterbury and South Canterbury. Foreign-card spending had already been down declining in West Coast during recent months, the company said.

Spending across all cards, foreign and domestic, was up 6.7 per cent in February to $5.19 billion, due to the extra day of spending, Paymark said.

On February 29, there was a spike in total card spending at supermarkets and chemists, relative to March 2, 2019. This spending spike was strongest in Auckland and Northland, with supermarkets up 40.2 per cent and chemists sharply up by 75.5 per cent.

There were wide-spread reports of Kiwis stockpiling groceries after the first confirmed report of Coronavirus in New Zealand.

However, the annual underlying growth rate for the previous three months has averaged 4 per cent, with the slowest growth during that period in Auckland and Northland.

During the same time period, growth in Palmerston North increased 14.4 per cent.