Car and Department Store Card Payments Surge 50%... "Wallets Opened for High-End Purchases"

Last Month, Card Payments Rose 40-50% in Cars and Department Stores
Need to Watch Until April to Confirm Consumption Rebound

[Asia Economy Reporter Ki Ha-young] Signs that suppressed consumer sentiment due to COVID-19 is reviving have been confirmed through card payments. This is interpreted as a kind of 'revenge consumption' phenomenon, particularly expressed through department store spending and automobile purchases.

According to the card industry on the 12th, last month, the automobile card approval amount of Card Company A surged by 48.5% compared to the same period last year. During the same period, spending at department stores also jumped by 43.2%. Discount stores such as large marts also increased by 14.1%, and personal credit sales were tentatively estimated to have increased by 7.6%.

High-value consumption was also noticeable at Card Company B. This card company also saw a 44.0% growth in card usage at department stores compared to the same period last year, and automobiles showed a 39.5% increase. Personal credit sales were found to have increased by 9.1%. Card Company C also estimates that card approval amounts last month rose by about 10% compared to the same period last year.

The card industry views that card consumption, which had concentrated on online spending due to refraining from going out during COVID-19, is noticeably expanding to offline as well. An industry official said, "While the online sector, which replaced offline consumption after COVID-19, maintained a growth rate close to 20%, offline sector performance such as department stores and discount stores also increased," adding, "The adjustment of social distancing levels applied from mid-February and expectations for the COVID-19 vaccine effect combined to release consumer desires suppressed for a year." The Consumer Confidence Index (CCSI) is also on an upward trend. According to the Bank of Korea, the consumer confidence index was 91.2 in December last year, rose to 95.4 in January, and increased to 97.4 in February.

However, there is also analysis that it is difficult to see the signs of consumption recovery as a return to pre-COVID-19 consumption. Another industry official said, "Personal credit sales also increased by more than 10% in the first week of March, continuing the consumption recovery trend," but added, "Since this could be a temporary phenomenon, we need to observe the trend until March and April to consider it a complete consumption rebound."

People Looking for Car Dealerships (Not Related to Article Content).
[Image Source=Getty Images]

This content was produced with the assistance of AI translation services.