After five years of consistent growth, spending on travel fell by 3.3% year-on-year in March – the first drop since March 2021 when Covid travel restrictions were still in place.
Travel, as defined by Barclays, comprises spending with travel agents and airlines, and on public transport and "other travel". Spending growth with agents, specifically, fell by 4.4% year-on-year in March, although transactions grew by 9.2%.
It was a similar story for airlines, which saw spending decline by 4.1% in March, although spending on hotels, resorts and accommodation (+1.2%) defied the downturn.
Iran war effect
The data compares transactions made using Barclays credit and debit cards between 20 February and 26 March 2025 with those made between the same dates in 2026. Barclays claims to administer nearly 40% of the nation's credit and debit card transactions.
Overall consumer card spending increased by 0.9% year-on-year in March following a 1% year-on-year drop in February. Essential spending went up by 0.5% year-on-year in March, the first uptick since July 2025, while discretionary spending growth slowed from +2.2% in March 2025 to +1.1%.
Accompanying survey data from Barclays suggest consumers are more wary about their spending as a result of the war in the Middle East.
At the start of March, 59% of the 2,000 respondents said they were concerned about rising travel costs; by the end of the month, this had risen to 70%. There was also a 1% increase in those concerned about travel disruption.
One in seven (14%) said they were delaying major purchases or financial decisions as a result of the Middle East crisis, with just over one in 10 (11%) saying they planned to cancel intended travel plans.
Meanwhile, nearly three-quarters (74%) said they anticipate tensions in the region to continue impacting the cost of living throughout the rest of the year.
Barclays speculated the uptick in spend on hotels, resorts and accommodation could be due to a preference for UK-based breaks and an increase in domestic bookings during the Easter break.
'Ongoing balancing act'
Jack Meaning, chief UK economist at Barclays, said: “Shoppers delaying major purchases and building up a savings buffer in response to the shock from the Middle East reinforces our view that activity will be muted in the coming months."
Karen Johnson, head of retail at Barclays, added: “March’s figures may highlight some differences between how consumers feel and how they actually spend. Cost-of-living concerns and economic uncertainty continue to weigh on confidence, prompting caution and a desire to cut back.
"Many are once again carefully managing their money while finding ways to prioritise the things that matter the most to them – an ongoing balancing act."
