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Foreign card spending reflects tourism growth

Foreign card spending reflects tourism growth

Auckland, Thursday 5th March 2015: Visitors to New Zealand in February spent $251 million, $31 million more than in February 2014 according to the latest figures released by Paymark.

Foreign card spending was up by 14.1% year on year reflecting Statistics New Zealand’s figures of ongoing growth in tourist numbers.

Whilst the total spending growth year on year was moderate at 4.3%, foreign card spending accounted for 12.6% of all credit card spending and 5.9% of the total spend recorded through the Paymark network in February.

Paymark’s Head of Customer Relations Mark Spicer says the moderate growth in February reflects the continuing low fuel prices and the February trend when people return to work and the school year starts. “There’s a strong seasonal element whereby it’s back to reality for the majority of Kiwis and that shows across most spending.”

In contrast, it’s been a strong month for tourism. Paymark processed credit card transactions from approximately 148 foreign countries during February.

Foreign card spending was highest in Otago where visitors to the country spent 42% more than February 2014 and in Bay of Plenty where foreign spending was up by 26.1%.

Paymark figures show that the highest number of foreign transactions were via Chinese and US issued credit cards with Australia and the UK also making a substantial contribution.

“Not surprisingly, more than 60% of the foreign card spending in February came through merchants in the hospitality or tourism sectors such as hotels, cafes and tourist activity operators,” says Spicer.

Other sectors that reaped the benefits of the increasing number of visitors to New Zealand were supermarkets and takeaways with an extra $2.9 million transacted through overseas credit cards. The clothing, footwear and jewellery sectors received a $2 million boost.

“This extra foreign card spending was a significant factor behind the double digit annual spending growth within the hospitality sector,” says Spicer especially in the accommodation, food and beverage sectors.” Total spending across the accommodation sector was up 15.5% on last February while the food and beverage sectors were up 12.7%.

Annual spending growth remains strong in the furniture, hardware and building supply sectors with an increase of 8.9%. This reflects the latest figures from Statistics New Zealand released yesterday showing more than $15 billion worth of building work was carried out in 2014, up $2.8 billion on 2013.

Other key statistics:
Spending at department stores is up 6.2% year on year.
Growth remains slow in the clothing, footwear and personal accessories sectors with an annual increase of 2.6%.
Taken across all sectors, annual growth rates were again highest in Nelson and Otago, up 10% and 9.8% respectively.
Areas that experienced negative growth in February include Gisborne, Taranaki, Palmerston North, South Canterbury and Southland.

The number of monthly card transactions was 7.9% higher than February 2014 with Paymark processing an extra 6 million transactions.

Credit card usage remains strong, up 17.2 per cent from February 2014 (including contactless cards), while debit card spending growth is at 4.8 per cent.

ends

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