Preparing for Changes in the Market this Holiday Season

Consumer spending sees a significant increase during the holiday season. Specifically for lenders and retailers, it is important to understand this spike in order to prepare for potential market changes both internally and externally.

Currently, the market is experiencing an increase in delinquencies, wealth and income volatility, student loan impacts and high savings rates. These trends have contributed to a reduction in consumer spending heading into the holiday season. With less disposable income for most generations, especially Generation Z, more people are looking to be conscious with their spending. Many consumers are equating savings and value and are reconfiguring needs and wants going into this gifting season.

Trends that are emerging for the 2025 holiday season are early shopping, Buy Now, Pay Later payment options, data-driven marketing and the rise of domestic travel. For lenders, this means that credit companies must be ready for the anticipated demand for card originations and higher card balances during this time. Additionally, increased credit and loan requests for the holidays are inevitable. For retailers, most consumers have less spending money, making them not only focused on value but also on saving when purchasing for loved ones. It is important to keep these predictions in mind as the consumer economy begins to change towards the end of 2025.

Source: Equifax