Israelis Set Record Credit Card Spending in Summer Months

Israelis spent a record 109 billion shekels using credit cards during July and August, according to data from Shva, the national payment systems operator. This represents a 7.9% increase compared to the same period last year. Over the past four years, summer spending has surged by more than 40%.

The significant price increases were particularly evident in the fuel sector. August saw a historic high in spending at gas stations, reaching an average daily expenditure of 68.8 million shekels, totaling 2.13 billion shekels for the month. This 13.8% year-over-year jump is attributed almost entirely to price hikes, with the average liter of gasoline costing 8.09 shekels in August compared to 7.07 shekels in August 2022. July alone set a monthly spending record of approximately 55 billion shekels.

August's credit card spending reached 54 billion shekels, a 10% increase from the previous August. Despite a slight 1.4% decrease in average daily spending to 1.75 billion shekels (excluding foreign currency transactions), this was influenced by more people traveling abroad in August compared to July.

Leading spending categories in August included grocery stores, which saw a 6% increase to 6.3 billion shekels, followed by restaurants, up 11.2% to 4.2 billion shekels. The electricity and fashion sectors each grew by 8.2%, reaching about 3 billion shekels apiece. The Israeli aviation sector experienced a slight decline of 0.8% to 427 million shekels, largely due to a shift in demand towards foreign airlines not included in Shva's data.

Consumer behavior in August also showed a return to physical shopping, with daily spending in brick-and-mortar stores hitting a record average of 758 million shekels, an 8.1% increase for the month to 23.5 billion shekels. Online spending moderated slightly, with a 4.2% decrease in average daily spending compared to July, though annual online purchases grew by 11.5% to 30.6 billion shekels. Cash withdrawals from ATMs remained stable at 5.9 billion shekels in August, similar to the previous year, indicating that cash usage remains prevalent and the overall spending increase primarily reflects nominal economic growth and price inflation rather than a shift away from cash.