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Traditionally, consumers have either saved up for Christmas and holiday gift spending or added balances to their credit cards. That was before the recession and before the value hunt took off. The recession’s aftermath has brought back the oldest form of credit — layaway has returned. As far as retailers are concerned, the layaway policies may be what makes or breaks this coming holiday season.

With interest rates so low, layaway really does very little harm to the liquidity of retailers, as long as their balance sheets are healthy. Companies are finding it harder and harder to get consumers to take on new store credit cards. Some of the key retailers already have started their holiday layaway plans.

It was just at the start of September that Wal-Mart Stores Inc. (NYSE: WMT) decided to ratchet up its efforts for layaway, as it softened up on layaway price minimums and the charges for layaway items. It dropped the layaway fees to $5 from $15, and it dropped the layaway cancellation fee after the company received “direct customer feedback.” In short, Walmart’s customers were telling the retail behemoth that it was gouging on its layaway plans. Its initial holiday layaway plan was set for September 14, a month earlier than anticipated.

Just a few days later, also in early September, Sears Holdings Corp. (NASDAQ: SHLD) one-upped Walmart’s layaway program by removing its layaway service fee for its online and in-store purchases, and it started on September 7. The company’s Kmart unit even went on to say that Kmart is currently the only mass retailer to offer the layaway program 365 days a year. Where Kmart trumped Walmart is that its layaway plan touted no minimum transaction amount.

Toys”R”Us has jumped on the layaway train, and it is offering a free layaway plan, including the debut of what it called the 2012 Holidays Hot Toy List. It offers a 20% down until October 31 with pickup after final payment any time up to December 16. Its 2012 holiday layaway plan also decided to waive fees and minimums versus prior expectations.

What is amazing is that most big chain stores have not implemented their layaway programs yet. If Walmart and Kmart are going to go big on holiday layaway efforts, many other retailers will not be far behind.

Best Buy Co. Inc. (NYSE: BBY) may be down and out as an Amazon.com Inc. (NASDAQ: AMZN) preshopping showroom, but it offers an ongoing layaway plan. Its plan states that products may be placed on layaway for no longer than 12 weeks (eight weeks on computers) and require a 25% down payment, plus a 5% layaway fee of the total product sales price at the time of layaway plan agreement. Will it drop a layaway fee for the holiday to lure more buyers?

TJX Companies Inc. (NYSE: TJX) shows a general layaway plan on its site, but no special plan has been set for the holidays. Its T.J. Maxx site notes that the stores will hold layaway items for up to 30 days with a minimum payment of $10 or 10%, whichever is greater, and a $5 nonrefundable create fee. The entire layaway must be picked up or canceled within the 30-day period, and a $5 cancellation fee will be applied in most states if it is cancelled.

We have yet to see any significant layaway push from Target Corp. (NYSE: TGT), but that may change as it has offered layaway before.

For consumers who really want layaway, a “virtual layaway program” is available via eLayaway. This is the online layaway payment processor that allows consumers to create and manage a payment schedule within their budget. Its store selection is broad but may not have many of the easily recognized store names.

Be advised that layaway may not always be as cheap or as attractive as it sounds in the grand scheme of things. Kiplinger wrote a report on stores charging fees (alternative to charging interest) and warned about cancellation fees, higher prices, spending money that you do not have and also that credit card rewards may be more enticing.

Whether or not layaway is smart is really up to the individual shopper. There is one interesting thought here though for those retailers who may or may not want to offer layaway. Having a layaway plan is now going to be cheaper than it has ever been, with borrowing rates so low for creditworthy companies. If a retailer with a healthy balance sheet can finance its inventory management for almost no costs with interest rates so low, chances would seem high that it can figure out a way to use fees and incentives so that the layaway program does not erode profitability or tie up too much liquidity.

The National Retail Federation is due to make its 2012 holiday prediction in early October, and that may say a lot about to expect for the broad holidays and how much layaway will really play into the big picture this year.

JON C. OGG