Visa and MasterCard report that holiday shopping this year is setting a record pace, indicating that consumer confidence is strong.

The day after Thanksgiving is viewed as a barometer of retail sales, because consumers launch their holiday shopping and traditionally spend the most money on that day.

San Francisco-based Visa said that consumers spent $1 billion on goods with their Visa credit and debit cards on Nov. 25 -- a new high for the day after Thanksgiving. Last year at that time, Visa cards were used to buy $800 million worth of goods.

MasterCard reported similar spending gains this year with consumers using the New York card brand to purchase $726.6 million in goods on Nov. 25.

Consumers this year increased spending over last year at department stores, discount stores, and electronics stores, and via mail order.

For example, Visa cardholders spent $264 million at department stores, up 17% from a year earlier. And MasterCard cardholders charged $136.4 million at department stores, up 18.2%.

Both bank card associations attribute the higher volume to improved economic conditions and new markets, like gas stations, supermarkets, and discount stores, opening over the past year.

"There is a heightened awareness that cards can be used at these [new] locations," said a MasterCard spokeswoman.

Thomas Layman, vice president and chief economist of Visa U.S.A. added, "In addition to more Visa cards being issued, by the end of last quarter, the number of merchants accepting Visa in the United States grew 5.6%, all contributing to the increases reflected in these early holiday figures."

The associations also believe that consumers are spending more with their cards to reap the rewards of cobranded or value-added cards.

Debit cards, too, are increasing consumer spending, say Visa and MasterCard.

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