# **5.2 Credit Card Data**

Our partner bank shared administrative data on credit card transactions for all customers in the sample. These data allow us to measure spending and borrowing behavior of all customers in our sample for 12 months prior to the intervention and 3 months after the intervention. The dataset contains detailed records of all credit card transactions that occurred during this time period, which include the transaction amount, description, vendor name, and spending category code.<sup>11</sup> The credit card data also include information about outstanding balances and repayment, which we use to measure consumers’ willingness to take on debt. Importantly for our purposes, each transaction in the data contains the standardized Merchant Category Code (MCC), a 4-digit identifier that classifies a business by the types of goods or services it sells. The MCC makes it possible to assign each transaction to a specific spending category. Importantly, for the goal of our analysis, the MCC allows us to distinguish between spending on durable, nondurable, tradable, and nontradable goods. To classify spending into durable versus nondurable goods, we follow the standard categorization used in the literature (see Aaronson, Agarwal, and French, 2012; Agarwal and Qian, 2014; Ganong and Noel, 2019; Chetty et al., 2020). For example, some durable spending items include apparel, consumer electronics, and furniture. To the best of our knowledge, no other paper has used MCCs to classify credit card spending into tradable and non-tradable expenditures. We therefore created our own categorization by manually inspecting each individual MCC and classifying it as tradable or nontradable. In our classification, all codes for services are assigned to the nontradable category, whereas codes for goods are assigned to the tradable category if those goods are typically imported or exported. For example, some tradable spending items include apparel and consumer electronics.

We summarize both MCC categorizations in Table 1. As there are thousands of individual MCCs, we report summary statistics using standard groupings of MCCs that are commonly used by financial institutions and in the academic literature. Column (1) reports the average spending for each MCC group in our sample. Column (2) indicates the fraction of spending within that MCC group that is classified as durable (the remainder is classified as nondurable by construction). Column (3) indicates the fraction of spending within the MCC group that is classified as tradable (with the remainder classified as nontradable). For example, the third row corresponds to the MCC group “automotive expenditures”, in which 100% of codes are classified as durables and 0% as non-durables, and 64% of the spending in this MCC group is classified as tradable versus 36% as nontradable (primarily codes corresponding to services). The last row of the table summarizes codes that we group as “uncategorized.” These miscellaneous MCCs do not contain enough information to categorize them as durable, as opposed to nondurable, or tradable, as opposed to nontradable, expenditures.

11. We do not obtain data on debit card transactions because that they account for a negligible fraction of spending according to pre-intervention summary data (debit cards are used primarily for cash withdrawals).

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