The news: Despite feeling financial pressure, US consumers aren’t skimping on holiday gift-giving, per PayPal’s 2026 Holiday Shopping survey. 

Sixty-four percent of Americans said they plan to spend as much as or more than they did last year, but they are changing their strategy: 

• 36% of consumers are planning to stick to a budget as their top choice in managing their holiday spending, and 32% and 31% plan to compare prices or wait for deals and promotions, respectively.
• 67% said they would redeem rewards to purchase a gift, and 55% have saved their rewards specifically for holiday shopping.
• Three-quarters of consumers who have used or who considered using BNPL in the past plan to do so for holiday shopping.

Zooming out: Higher gas prices, ongoing inflation, and price hikes from tariffs are pinching US households’ budgets. As a result, consumers across all income levels say they’re planning to reduce their discretionary spending, per a McKinsey & Company’s ConsumerWise survey.

Holiday sales growth will trail total spend for the second year in a row in 2026: We forecast that US holiday retail sales growth will hit 4.1% this year. 

Implications for merchants and payment providers: Retailers and merchants will have to fight to get holiday spending from price-sensitive consumers. 

Partnering with BNPL providers can help retailers snag more spend from young consumers in combination with promotions. And younger consumers are more likely to pick their merchants based on BNPL availability: 38% of millennials and Gen Zers say they are “very or extremely” influenced to shop at merchants for non-grocery retail based on their ability to check out with installments, per PYMNTS Intelligence.

Consumers’ appetite for deals and strategic rewards redemption also opens up an opportunity for payment providers to lean on their financial media networks (FMNs) to drive spending. As consumers check their payment apps to redeem rewards, providers can serve them exclusive card-linked offers to generate even more volume. Holiday sales made via mobile will account for 60% of total holiday ecommerce sales volume, per our forecast.

Read more: To dive deeper into holiday retail sales analysis, explore our 2026 Holiday Shopping report.

This content is part of EMARKETER’s subscription Briefings, where we pair daily updates with data and analysis from forecasts and research reports. Our Briefings prepare you to start your day informed, to provide critical insights in an important meeting, and to understand the context of what’s happening in your industry. Non-clients can click here to get a demo of our full platform and coverage.