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Airwallex data shows most Australians reduced purchases over the past 12 months, although some states benefited from an increase in travel bookings.
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Consumers cut online spending by almost $600 in FY23
14 July 2023
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9 minute read
Consumers spent almost $600 less shopping online compared with a year ago as they dial back discretionary purchases, according to the latest Digital Economy Index from fintech Airwallex.
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Former big spenders in NSW drove the retreat by cutting back 8 per cent, or more than $913 a person, in the year to the second quarter 2023 although they still racked up the largest digital bills at $10,497 each on average.
Spending also declined in Victoria by 5 per cent to $8,405, in South Australia by 6 per cent to $3,573 and in Queensland by 7.5 per cent to $3,286.
Both Western Australia and Tasmania bucked the trend to record slight increases and this was reflected in a national decrease in online spending of less than 2 per cent, or $587 per adult.
Airwallex director of strategy for Australia and New Zealand Amelia Hamer said the findings showed the spending downturn was uneven across the country.
“Across the digital economy, we see Australians are holding back on their discretionary spending,” Ms Hamer said. “As interest rates have climbed and cost-of-living pressures have increased, it’s no surprise Australians are being more selective about where they spend online.
“There are still lingering effects of the travel bounceback post-COVID in this data, with the surge in online travel particularly benefitting destinations like Queensland, Tasmania and Western Australia.
“However, the data shows that NSW is bearing the brunt of the change in how Australians are spending their money online. This downturn is something we’re seeing in the quarter-by-quarter comparisons in other states too.”
She the data was also uneven by sector, with strong upticks in online education and travel spending overshadowed by declines in retail, insurance and self-managed investments.
There was some positive news in comparisons between Q1 and Q2 this year, with digital businesses in Victoria, Queensland and Western Australia recording spending increases above 6 per cent, and other patchy signs of recovery.
In NSW, for example, digital travel business rebounded 15 per cent, in Victoria e-commerce spending jumped 8 per cent and in Queensland recorded a 5 per cent increase in online travel spending.
“We see several bright spots in Australia’s digital economy, with the technology, education and travel sectors seeing the most upside,” Ms Hamer said.
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