CONSUMER spending on Visa cards has increased in recent months, offering a "glimmer of hope" for the economy, a report has found.

Seasonally adjusted figures from Visa Europe’s UK Expenditure Index showed a spending increase in the three months to September of 0.4%, seen as a more reliable indication of underlying trends.

General expenditure went up by 2.5% month-on-month ... but it was down by 0.9% compared with 12 months ago.

Visa said this was a slight improvement on August, when the year-on-year decline was 1.3%.

The index is based on spending on all Visa debit, credit and prepaid cards, which account for every £1 in £4 of all UK spending.

The squeeze on household finances has also seen them tighten their belts when it comes to buying a car and using transport, phone and internet bills, food and clothing.

The September data showed online spending has gone up by 8.9% in a year, while purchases made “face-to-face“ in the UK have slumped by 2.1%.

The report said that while the figures offer a “glimmer of hope for the UK economy,” they also showed the “continuation of a choppy trend“.

The report said: “Despite signalling a relative improvement since the second quarter, Visa Europe’s UK Expenditure Index continues to paint a picture of a subdued UK consumer.

“This reflects a combination of factors such as a squeeze in household finances and ongoing job insecurity.”

The amount splashed out on hotels and restaurants shot up by 8.9% compared with 12 months ago.

Transport and communication, which covers buying vehicles, using transport, post, telephone and internet expenditure, saw the biggest spending decline, a drop of 6.1%. UK shoppers have also cut back spending on food, drinks and tobacco, by 5.9%, and clothing and footwear by 1.2%.