Consumer Pulse Q3 2021

Negative financial impact persists due to COVID-19

The percentage of consumers reporting their household income is currently being negatively impacted by COVID-19 reached 64% in Q3 2021. While many hoped a faster vaccine rollout would drive economic recovery, the majority of consumers believed their household income will be negatively impacted by the pandemic in the future (54%). 

Cutting back discretionary spending and increasing savings

Most consumers (82%) were worried about their ability to pay current loans and bills in full. Possibly in anticipation of economic turbulence and negative effects of pandemic relief policies on price inflation, half of them (51%, increased 4 percentage points from Q2 2021) cut back on discretionary spending in the past three months and diverted income into savings and debt payments. Specifically, in the last three months, 55% of consumers said they saved more in an emergency fund (up from 45% in Q2 2021), and 27% said they paid down debt faster (up from 19% in Q2).

Customers seek alternative lending

The traditional concept of lending is broadening. The majority of consumers have heard of Buy Now Pay Later (BNPL) with Millennials (74%) and Gen X (78%) reporting the most awareness.

Millennials (40%) and Gen Z (38%) are the generations most wanting to try BNPL, while Gen X (34%) was most likely to make larger purchases with the service. Baby Boomers (60%) most believed the service could spread payments over time. More than 30% of each generation surveyed agreed it was easy to apply for BNPL.