Bank card spend by Sri Lankans bucked the two-month lengthy contraction, swinging to a pointy improve in July, days after the nation eliminated month lengthy restrictions in June in what seemed to be a mirrored image of some semblance of financial normalcy which was quick lived.
In accordance with knowledge, the whole excellent bank card steadiness soared by Rs.3, 027 million in July to Rs.121.66 billion.
The rise in July in reality solely managed to revive the bank card steadiness to the extent close to its April highs when the 5 month lengthy rising streak ceased and reversed within the following two months resulting from financial restrictions that went into impact to comprise the virus unfold.
Not like in a typical month, the July surge in card spend couldn’t be fully attributed to the corresponding surge in shopper spend as considerations mounted over the usage of playing cards for prime ticket measurement international purchases for industrial causes to be able to sidestep the international change rationing and vastly completely different international change charges charged on imports in comparison with the official charge.
This prompted banks to restrict sure international change transactions that passed off through bank cards sparking considerations amongst individuals if they’re barred from utilizing their playing cards for international purchases.
A month later in August, the Central Financial institution issued a press release reminding card customers that, “present transactions of non-public nature,” can occur sans limitations.
Whereas bank card spend remains to be not an excellent barometer for gauging the patron spending dynamics in Sri Lanka resulting from its nonetheless huge inhabitants that doesn’t personal bank cards, it supplies a sure concept on shopper spending patterns specifically on leisure associated spending, spending on eating outs, healthcare associated spending, shopper sturdy spending and upmarket retail.
By the tip of July, there have been 1.94 million bank cards in lively in Sri Lanka for an 8.5 million labour drive.
Throughout July, banks had offered 4,151 playing cards bringing the whole variety of playing cards issued within the first seven months in 2021 to 62,176.
Whereas the quantity of transactions that shifted electronically usually are not mirrored totally by the bank cards spend, there was an unlimited shift in the usage of cost purposes through on-line and debit playing cards by a big swath of individuals in Sri Lanka because the pandemic pushed many who in any other case are much less inclined for on-line transactions on digital funds platforms provided by the banks.