New data from Barclays’ Consumer Spend Report shows that UK spending on debit and credit cards fell for the first time since the pandemic in 2025, as consumers adopted a more cautious outlook and savvier shopping behaviours.

Its figures showed that the overall value of card spending in 2025 dropped -0.2% compared to last year. This represents a significant slowdown versus the +1.6% growth in card spending seen in 2024, which followed a +4.1% rise in 2023.

Consumer caution key driver in reduced card spending

Consumer caution and savvier shopping – where customers prioritise discretional spend to make disposable incomes work harder – were among the key factors lowering levels of card spending, according to the report.

Separate data released from KPMG earlier this week also pointed to ongoing consumer caution impacting spending, which is set to continue into 2026.

Its poll showed deepening economic concerns will prompt half (49%) of shoppers to cut discretionary spend and a further 34% to defer big-ticket purchases as we enter the new year.

Beauty bucks the trend as lipstick effect lifts spending

However, despite the slowdown in overall card spending, shoppers were still willing to treat themselves to affordable luxuries, according to Barclays’ data.

“While confidence in the UK economy has declined… through purposeful spending, consumers continue to prioritise the things that bring them joy, unlocking the potential for UK economic growth,” said Karen Johnson, Head of Retail at Barclays.

The “lipstick effect” – where consumers buy smaller mood-boosting treats in times of financial pressure – helped buoy sending across Health & Beauty and Fashion. Card purchases in the Health & Beauty category saw some of the strongest growth in 2025, rising +9.5%, while Fashion spend also saw an increase of +0.7%.

This mirrors key trends outlined in Euromonitor International’s Global Consumer Trends for 2026 report, where comfort and simplicity and ‘rewired’ wellness are expected to be among the key catalysts shaping shopping habits next year.

“The future of consumer behaviour is characterised by a desire for comfort, self-expression and cutting-edge wellness solutions, driven by the need for authenticity and simplicity in an increasingly complex world,” said Alison Angus, Head of Innovation at Euromonitor International.