Banco Popular de Puerto Rico

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Unlike past economic recessions where businesses and consumers have had to adjust their payment habits and debt levels over the course of months or quarters as the economy shrank, the coronavirus-induced economic crisis has forced many to make much more abrupt financial adjustments.

Cash usage dropped much lower due to the coronavirus pandemic, and it appears that credit cards may be exhibiting some signs of abandonment as well.

The COVID-19 pandemic has teed up a growth opportunity for the buy now, pay later (BNPL) financial industry, as recession worries made people receptive to entering short-term payment plans that can fit in a budget.

Cash use will suffer because of this outbreak, and there are factors other than germs contributing to this trend. A growing work-from-home workforce will funnel more shoppers into digital channels, including ones they may have never tried before.

For a growing number of people, the coronavirus has disrupted their daily lives in how they work, where they eat and how they spend their money. This drastic change has caused a boom in some sectors of the economy and a bust in other areas.

While reports of toilet paper and hand-sanitizer shortages may be common stories on the nightly news, one consumer goods category is flying off the shelves at an even faster pace, one never seen before – guns and ammunition, increasing payments volume for gun shops, a merchant category financial service providers traditionally avoid.

As millions of U.S. consumers are beginning to see stimulus checks electronically deposited into their bank accounts as part of the CARES Act, many companies are wondering how Americans will spend these funds.

There is one area of commerce that has experienced an uneven consumer response to the coronavirus crisis: subscriptions. Some companies have benefited greatly while others have not.

The coronavirus pandemic has had an immediate impact on a wide swath of consumer spending habits and payment choices — some of which may remain in place for some time after the crisis subsides — as certain categories such as travel have fallen to the wayside and others such as grocery stores have risen as more consumers eat meals at home.