With all Covid restrictions lifted, Sweden is once again free to visit. Analysis of Net's card turnover shows that foreign traveler consumption is starting to recover, with positive prospects for both cross-border trade, tourism and business travel.

One week after all Covid restrictions were lifted on February 9, 2022, international card turnover in Sweden increased by 26.1 percent compared to the previous week. For the whole of February, the increase was 60.1 percent compared to January – strong signals that the upward trend in 2021 will continue. However, the level is still just under 80 percent compared to before the pandemic.

– Hotels, border shops, retailers and other traders in Sweden with a significant proportion of international customers can breathe a sigh of relief. Although these companies experienced the largest loss ever in 2020 due to Covid and travel restrictions, the effects appear to be relatively temporary, says Louise Richardson, Sweden manager for Nets, which is part of Nexi.

Analysis of Nets card transaction data shows that foreign card purchases in Sweden increased by 26.6 percent in 2021, following the largest decline ever in 2020. This places Sweden at the forefront of the Nordic countries in winning back international traveler spending. In comparison, international card transactions in Denmark increased by 23 percent in 2021 compared to 2020. Finland and Norway are a bit behind at 14 percent and 6.5 percent respectively. 

Cross-border trade is recovering strongly 
Cross-border trade appears to be the fastest-recovering sector in Sweden. In 2021, Norwegians were, as always, the largest group of foreign shoppers in Sweden, accounting for 15.4 percent of total international card turnover. In the first week after the restrictions were lifted, the Norwegian share of international card turnover in Sweden continued to increase compared to the previous week. Grocery stores, for example, saw an increase of 55 percent. 

“Significant savings not too far away were no longer possible for Norwegians due to travel restrictions in 2020, preventing purchases of food, clothing and everyday items in Sweden. As this trade requires little or no planning compared to tourist travel, it is no surprise that this type of consumption from foreign visitors is recovering quickly,” continues Louise Richardson. 

Business travel is not dead, just different
The outlook for business traveler consumption has been more uncertain. Companies around the world have adopted and learned hybrid working methods and video meetings instead of meeting physically, and are also a way to cut both their travel costs and their carbon footprint. However, Net’s international card turnover indicates – even if the volume has not yet reached pre-pandemic levels – that there is still a positive trend. The change in international card turnover from 2020 to 2021 shows almost as strong growth for corporate cards (+25.8 percent) as for private cards (+26.9 percent). However, tourists significantly outnumber business travelers and also account for a much larger share of the total turnover volume. 

“It doesn’t appear that business travelers have completely put away their suitcases, passports or corporate cards. Retailers who previously had business travelers as an important customer group can still expect a significant portion of these customers to return, although business travel may not fully return to previous levels,” continues Louise Richardson. 

Larger cities attracted the most visitors in 2021
In 2021, metropolitan regions such as Stockholm, Gothenburg and Malmö had the largest share of card turnover from foreign travelers. However, the week after the restrictions were lifted, both Stockholm, Gothenburg and Malmö had lower shares of total international card turnover compared to the share in 2021. This indicates a more even distribution of foreign visitor consumption in Sweden going forward. As expected, merchants that are traditionally important to foreign travelers benefited the most: food and accommodation, attractions and entertainment. 

For example, international card turnover increased from 2020 to 2021 by 52.1 percent for hotels, 73.3 percent for restaurants and cafes, and 29.4 percent for entertainment and attractions.

To read the full article from Net's series Business Insights, which also contains advice for traders, see here: https://info.nets.se/blogg/int… 

Nationalities – largest share of total foreign card turnover in 2021:

1. Norway: 15.4 %
2. United States: 11.3 %
3. Denmark: 10.4 %
4. Germany: 9.7 %
5. United Kingdom: 5.8 %

Regional share of total foreign card turnover 2021:

1. Stockholm: 36 %
2. Gothenburg: 22.8 %
3. Malmo: 16.2 %

Foreign card turnover one week after the restrictions was lifted compared to the week before:

• Total increase: +26.1 % (+60.1 % for the whole of February compared to January, but still about 4/5 of the pre-Covid level).
• Regions – top 3 – share of turnover:
  • Stockholm: 29 %
  • Gothenburg: 12.1 %
  • Malmo: 6 %
• Sectors –sales growth:
  • Bars etc: + 142 % 
  • Retail trade excl. grocery stores: + 30.8 %
  • Amusements and attractions: + 53.7 %
  • Restaurants and cafes: + 38.3 %
  • Grocery stores: +55 %
  • Hotel: + 29.7 %
• Countries – top 3 – share of turnover:
  • Norway: 19.7 %
  • United States: 12.4 %
  • Denmark: +10.3 %