Velera Payments Index: Card Transactions Remain Positive
- Roy Urrico
- 23 hours ago
- 5 min read
By Roy Urrico
July card spending growth results reflect a continued positive trend in consumer engagement, according to the August edition of the Velera Payments Index. The report also looks closely at business credit cards, highlighting how they compare with consumer cards and where they may present new growth opportunities for credit unions serving small and medium-sized businesses (SMB).
St. Petersburg, Fla.-based Velera, which describes itself as the nation’s premier payments CUSO, produces the Velera Payments Index to help credit unions and other financial institutions make strategic, data-informed decisions.
While debit purchase growth continued to outperform certain industry projections, credit purchase growth remained positive (moderating from recent highs). Spending in July was supported by back-to-school shopping, which helped offset the shift of promotional retail activity from July 2025 into June this year, according to the Index. The broader economic environment remained generally supportive of consumer spending, with mixed-to-improving consumer sentiment, steady wage growth and some easing of inflation.
“Business cards may represent a smaller share of overall card activity, but they point to a meaningful opportunity for credit unions,” said Sheba Carnes, Vice President, Product Management, Velera. “Small businesses are often highly engaged relationships, and many already look to credit unions for service, guidance and community connection.”
Carnes continued, “As these businesses expand, credit unions have an opportunity to grow with them by offering the payment solutions, expense management tools and financial support that help them manage cash flow, separate business and personal spending, and deepen the relationship over time.”
Key Takeaways
“Consumer confidence indicators diverged in July, reflecting ongoing caution alongside emerging signs of improvement,” the Index reported. Highlights included:
Consumer spending continued to show strength in July, with debit purchase growth remaining strong at 8.8% year-over-year and credit purchases increasing 2.7%, “despite moderating from recent highs as promotional sales events from Amazon and other major retailers shifted into June,” noted the Velera Payments Index. Early back-to-school shopping helped sustain momentum. Money services, goods and gasoline were the primary drivers of debit purchase growth, while gasoline and services led credit purchase growth.
The University of Michigan’s Index of Consumer Sentiment increased to 55.2, up 11.5% from June and marking its second consecutive monthly improvement. Lower gas prices and resilient consumer spending helped drive the improvement, with gains observed across income, education, wealth and political party affiliation. Despite these recent improvements, sentiment remains 11% below its level from a year ago, underscoring the continued impact of elevated prices on consumers’ economic outlook. By contrast, the Conference Board’s Consumer Confidence Index fell 1.4 points to 90.8, down from an upwardly revised 92.2 in June.
The labor market showed signs of softening during July 2026. The Bureau of Labor Statistics (BLS) reported a loss of 23,000 jobs, in contrast to the WSJ poll of economists' expectation of an 83,000-job increase. The unemployment rate edged down to 4.1%, caused by the labor force participation rate falling to 61.4%, while wage growth also moderated to 3.15%. Employment declined in local government, education and retail trade, while healthcare continued to add jobs. Meanwhile, the ADP jobs report showed private-sector payrolls increased by 44,000 jobs in July, though hiring slowed from the previous month and fell short of expectations. Gains were concentrated in education and health services, financial activities and professional and business services, while employment declined in leisure and hospitality, as well as in trade, transportation and utilities. Annual pay growth for job changers accelerated to 4.4%, the fastest pace in nearly a year.
Inflation trends moved in a more favorable direction for consumers. The U.S. Consumer Price Index (CPI) grew 0.1%, bringing the 12-month annual inflation rate to 3.4%, down slightly from 3.5% in June. Shelter was the primary driver of monthly inflation, accounting for about two-thirds of the increase. Medical care, airline fares and food away from home also posted gains. However, declines in several volatile categories, including energy and motor vehicle insurance, helped keep headline inflation in check. Core CPI, which excludes food and energy, increased 0.2% in July after remaining unchanged in June.
Deep Dive: Business Cards
For August, the Velera Payments Index explored trends in spending behavior for business credit cards and how they compare to consumer cards for nearly 300 financial institutions in its fixed-set population that offer both credit card types.
Business card transactions and purchases represented 25.8% and 42.7% of overall credit card activity year-to-date, respectively, for the smaller financial institutions studied. Those cards accounted for only 3.2% and 8.4% of overall credit transactions and purchases, respectively, but outperformed consumer cards in transactions per account, purchases per account, average purchase and average interchange rate.
On a year-to-day monthly average basis, business cards generated 18.3 transactions per account, $3,604.15 in purchases per account and an average purchase of $196.56, compared with 13.5 transactions, $951.21 in purchases and an average purchase of $70.25 for consumer cards over the same period. Additionally, the year-to-date interchange rate for business card purchases has been 38% higher than the rate for consumer card purchases.
The Index also found “since January 2025, business cards have also shown higher transaction and purchase growth than consumer cards but have experienced greater volatility due to lower volume.” The goods and services sectors were the leading categories for both business and consumer card purchases at 69.3% and 57.1%, respectively, year-to-date. Business cards saw less transactional and purchase activity in the food and grocery and restaurants sectors, as well as higher activity in travel and transportation compared to consumer credit cards.
Financial institution activity from Index:
For financial institutions with fewer than 20,000 accountholders, business card transactions and purchases accounted for 25.8% and 42.7% of overall credit card activity, respectively.
Business card transactions and purchases contributed 4.5% and 12.1%, respectively, to overall credit card activity for mid-size financial institutions (20,000-100,000 accountholders).
Financial institutions with more than 100,000 accountholders saw the least impact, with business cards signifying 1.4% and 3.2% of overall credit card transactions and purchases, respectively.
“This is consistent with research suggesting that smaller, community-focused financial institutions allocate a significantly higher proportion of their assets to small business lending than large national financial institutions,” the Deep Dive submitted: “It is important to note that smaller credit unions have been experiencing slower growth and losing share to mid-size and large credit unions since January 2025, suggesting a competitive landscape and challenges in scaling a community-based approach.”
What Credit Unions Should Do Now
The Velera Payments Index recommended opportunities for credit unions such as:
Unlock New Growth Opportunities Through SMB Banking. SMBs represent a significant and largely untapped growth opportunity for credit unions, making now the ideal time to expand into SMB banking. “By streamlining account opening and offering competitive loan, card and digital banking solutions, credit unions can become trusted financial partners to business owners while creating new revenue streams.”
Understand SMB Needs to Build Lasting Relationships. “Unlocking the full opportunity of SMB banking relationships begins with understanding how business needs evolve at every stage of growth.” Credit unions can differentiate themselves, strengthen relationships and expand their role as trusted financial partners over time.
Win the SMB Opportunity: Strategies to Support Business Growth. “Velera’s Explore Your Niche in the SMB Space blog provides practical strategies for credit unions looking to build a compelling SMB value proposition,” said the Index.
