Velera Payments Index: Consumers Keep Spending Despite Rising Gas Prices
- Roy Urrico
- 4 hours ago
- 5 min read
By Roy Urrico
Despite a sharp increase in gasoline prices, consumers kept spending in April, posting strong growth in debit and credit card transactions and purchases. That is among the findings of the May edition of the Velera Payments Index. Velera’s Deep Dive also looked into digital payments.
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.
Key May Index takeaways include:
For April, debit purchases increased by 8.5%, with the money services, goods and gasoline sectors accounting for three-quarters of that growth. Credit purchases were up 3.1%, with gasoline accounting for 35% of the entire increase. In April, debit transactions were up 5%, and credit transactions rose by 2.6%.
The Consumer Price Index (CPI) surged 0.6% in April, taking the 12-month inflation rate to 3.8% and marking the largest increase in two years. Gasoline was again the primary driver, accounting for roughly 40% of the increase. Also increasing were the house and food indexes. The 12-month Core-CPI, which excludes food and energy, rose to 2.8%.
Digital wallets continued to gain momentum. Year to date through April, digital wallets accounted for 12% of all debit transactions, up from 9% a year earlier, and 7% of all credit transactions, up from 6%.
“April’s data reinforces a familiar but important theme: Even as higher gas prices and renewed inflation pressures weigh on sentiment, consumer spending behavior has remained steady,” said Cody Banks, SVP, product experience and enablement, Velera. “Debit and credit activity continued to grow, with an increasing share of that activity shifting toward digital and tokenized payment experiences."
Banks continued, "While factors such as tax refunds provided near term support, the broader takeaway is the continued adaptability of consumers and the growing role digital payments play in how everyday spending is managed. For credit unions, this underscores the importance of closely monitoring where spend is evolving and ensuring digital capabilities keep pace with changing consumer expectations.”
Some Economic Indicators
As of May 11, the average price for a gallon of gasoline was $4.50 – 44% higher than a year ago and 53% higher (or $1.56) since the war with Iran began on Feb. 23.
For April 2026, the University of Michigan Index of Consumer Sentiment dropped 6.6% from March (53.3) to 49.8. The reduction was apparent across all demographics (age, income, education and political party). The war in Iran continues to influence consumer sentiment, as it affects gasoline prices and overall inflationary pressures, according to the Velera Payments Index.
For April, the Conference Board reported that consumer sentiment in the Consumer Confidence Index edged up 0.6 points to 92.8. Despite notable concerns over gasoline prices, overall sentiment remained about the same for April.
The Bureau of Labor Statistics (BLS) reported jobs grew by 115,000 positions in April. The unemployment rate remained unchanged at 4.3%, or 7.2 million people. Jobs grew by 55,000 positions for the month, more than twice the estimate of the Wall Street Journal poll of economists. April job gains came in health care, transportation and warehousing, and retail trade. Job losses in federal government positions continued in April.
The April ADP jobs report, which tracks changes in U.S. private employment, reported an increase of 109,000 jobs. Increases were in education and health services, trade, transportation and utilities, construction, and financial activities sectors. ADP noted Job reductions in the professional and business services sector.
For April, the BLS reported a 0.6% increase in inflation. The energy index was again the largest contributor to the monthly increase, up 3.8% and accounting for 40% of the overall increase. Also increasing for April were the shelter and food categories. Core CPI, which excludes food and energy, rose 0.4% in April, finishing the month at 2.8%. Categories contributing to the Core CPI increase included household furnishings and operations, airline fares, personal care, apparel and education. Reductions were recorded in the new vehicle, communication and medical care indexes for April.
Deep Dive: Digital Payments
“In this edition of the Payments Index, we revisited the primary use of credit and debit cards and provide their perspective on digital payments, which represent the alternative uses of payments without a physical card required to facilitate the transaction,” said Velera in its Deep Dive on digital payments. This includes all card-not-present (CNP) activity, as well as all tokenized transactions. While most tokenized transactions are CNP, Velera included card-present (CP) tokenized activity associated with digital wallets, namely the ‘Pays’ (Apple Pay, Google Pay, Samsung Pay).
“The converse of digital payments represents the remaining activity for credit and debit cards and includes more traditional physical card payments, or ‘card in hand’ activity. These transactions and purchases are the total of all tapped (contactless), dipped (EMV chip), swiped (mag stripe) and nominal activity in which the card was keyed,” noted the Deep Dive.
Contactless “tap and go” activity is encrypted but not tokenized in the same way as digital wallet activity. As a percentage of overall credit and debit card transactions, contactless transactions continue to increase. Contributing to the growth are the increase in contactless cards in the market, consumer comfort and acceptance of “tapping” transactions, and increased merchant adoption of terminals that accept contactless transactions. Year to date through April, contactless credit transactions represented 29% of all credit transactions, up from 25% in 2025. Contactless debit transactions represented 26% of all debit transactions, up from 20% in 2025.
“There remains an expectation that contactless card activity will replace lower dollar-value cash transactions, which does appear to be happening, as the average ticket amount is lower than card-present volume,” said the Velera report. Year-to-date through April 2026, contactless credit purchases represented 22% of overall credit purchases and contactless debit purchases represented 18% of overall debit purchases.
Non tokenized debit also represented 20% of overall debit card transactions, down from 21% in 2025. For physical card activity, the growth in contactless transactions comes from a shift in EMV transactions, likely due to fewer chip-only cards in the marketplace. Year-to-date through April, EMV chip transactions accounted for 21% of all credit transactions, down from 27% in 2025. EMV chip transactions accounted for 25% of all debit transactions, down from 30% in 2025.
What Credit Unions Should Do Now
The Velera report also presented market opportunities for credit unions, summarized here:
Deepen engagement inside digital banking. “Your mobile app and digital banking platform should serve as the central hub for card management. When members can easily set controls, receive real-time alerts, review and redeem rewards, or instantly access a digital version of their card, they are far more likely to keep that card top of wallet. Adding personalized prompts and seamless self-service tools further reinforces frequent, high-value interactions.”
Adopt a digital wallet-first strategy. “As more everyday spending shifts to mobile wallets, credit unions that make wallet provisioning seamless gain a clear advantage. Encouraging members to add their card to a wallet at activation, highlighting security and convenience benefits, and offering incentives for early wallet transactions all help ensure your card becomes the default payment method in members’ digital lives.”
Enable instant origination for digital-first expectations. “Today’s consumers expect speed and immediacy at every touchpoint. Credit unions that deliver instant decisioning, streamlined digital applications and immediate access to a digital card upon approval remove traditional origination barriers. When applicants can apply anytime, receive approval in moments and start transacting within minutes, credit unions capture early spend, accelerate membership growth and meet digital-first expectations.”
Advance your digital user experience with expert guidance. “Velera’s Advisors Plus delivers expert digital experience consulting that helps credit unions evaluate, optimize and strengthen their online and mobile banking experiences.”