Shoppers are doing all they can to keep their credit cards in their wallets this holiday season.
They're paying with cash, direct debits from bank accounts, taking advantage of free financing and even cashing in frequent flier miles.
A desire to stick to a budget and to avoid interest rates that have risen sharply have helped drive a marked shift away from credit cards. Banks also have reduced the amount of credit they're making available, even to low-risk clients.
"Consumers are looking for discipline in their spending levels that they can achieve from using cash," said Bryan Eshelman, managing director in the retail practice of consultant AlixPartners, whose recent survey of shoppers revealed their top concern was eliminating personal debt.
Often, the switch to cash or debit cards means lower costs for stores, though merchants miss out on getting data on their customers' shopping habits from credit card transactions.
Layaway and other payment methods increase costs, but they can be offset by new opportunities to grab sales from customers who would otherwise not able to buy.
Bill Hampel, chief economist at the Credit Union National Association, describes the consumer switch as "seminal."
"People are trying a lot of new behavior in how they're spending and how they are paying for it in response to a very scary economy," he added.
Some new habits, particularly using more cash, will likely linger, with unemployment expected to remain high for several years and credit lines less generous.