New MasterCard Study Examines Consumer Spending Trends Since Financial Crisis


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Purchase, NY – (September 16, 2013) – As U.S. consumers are slowly climbing out of recession, new research from MasterCard (NYSE: MA) shows that, in 2012, consumers continued to feel better about their financial outlook and began loosening their purse strings – resulting in a $172 billion, or 8.4 percent, boost in industry credit card volume vs. 2011. However, those same consumers remained cautious and continued to seek value. MasterCard’s research paper, “Road to Recovery: The Cautious Rise of the U.S. Consumer,” delves into the consumer spending trends going back to 2008 to reveal that a more resilient and chastened consumer base is emerging, and they are driving a post-crisis shift towards increased credit card spending.

The new study takes a historical view of changes in attitude and behaviors among consumer spending, borrowing and choice of tender. In 2012, debit and prepaid card volume across the industry grew by $129 billion, but there was a nearly $8 billion shift from debit and prepaid to credit cards. While over the past four years debit card spending has grown at a faster clip than credit – 44 percent compared with 14 percent – some of this growth can be attributed to the $91.3 billion in spending that shifted from cash to debit – a clear indication that electronic payments are continuing to displace other forms of payment.

“In the early years of the financial crisis, there was approximately $141 billion that shifted from credit to debit card spending,” explained Nitin Sumangali, who authored the consumer spending report for MasterCard’s Global Insights group. “Now that financial circumstances have improved, the tide has turned back to increased credit spending and borrowing – a trend that MasterCard first spotted in 2011. It’s not that debit cards and credit cards are necessarily replacing one another,” he continued. “Rather our research indicates that as consumers become less fearful about their financial situation, they feel more confident about their ability to use credit and debit cards as complementary tools to manage their money. Regarding credit, debit and prepaid, it has never been a zero-sum game.”

A Tale of Two Segments

MasterCard’s proprietary research identifies two consumer super segments – Credit on the Edge consumers and Credit Worthy consumers. Both segments have grown more confident in their ability to manage their finances and as a result have become more comfortable carrying a balance on their credit cards.

In addition, 77 percent of Credit on the Edge consumers are comparing prices more often than in the past, down from 79 percent the year before. By contrast, 54 percent of the Credit Worthy segment say they are comparing prices more, down marginally from 55 percent the year before.

“For the Credit Worthy segment, which was less severely impacted by the economic downturn and more willing to spend and borrow at manageable levels, there is an opportunity for financial institutions to help them better manage their liquid assets and provide an enhanced payments experience,” said Sumangali. “In comparison, Credit on the Edge consumers have a more fragile sense of security. This segment needs more wide-ranging financial management tools to have a better grasp on their liquid assets as they continue to allocate consumer spending between debit and credit cards.”

Rewards in Interesting Times

Rewards continue to be an important driver for credit card spending as consumers look for more value from their payments products, according to a key MasterCard finding. In 2012, 54 percent of consumers said they use their credit card because it offers rewards – up nine percentage points from 2008. Cash-back rewards have become particularly popular – in 2008, 38 percent of consumers said they continued to use credit cards because of cash-back rewards; by 2012, that number grew to 46 percent.

“Consumers are discovering that one of the major benefits of electronic payments is the opportunity to receive offers and rewards,” said Sumangali. “What’s notable is that the average dollar amount of credit card transactions went down by more than $2, from $95 to $92.9, between 2008 and 2012. This suggests that in this new economy, consumers are using credit cards even for smaller purchases, and rewards are offering a key incentive for them to do so.”


MasterCard’s analysis for this thought leadership series involves taking publicly available government data on U.S. consumer spending, as well as data from industry sources, and triangulating against MasterCard’s own proprietary spending metrics to confirm the direction of spending trends; market research, meanwhile, surveys consumers about changes to their financial attitudes and spending behaviors. By combining the data of all these sources, MasterCard is able to create a rigorously analytical picture of the changes to the U.S. consumer.

About MasterCard

MasterCard (NYSE: MA),, is a technology company in the global payments industry. We operate the world’s fastest payments processing network, connecting consumers, financial institutions, merchants, governments and businesses in more than 210 countries and territories. MasterCard’s products and solutions make everyday commerce activities – such as shopping, traveling, running a business and managing finances – easier, more secure and more efficient for everyone. Follow us on Twitter @MasterCardNews, join the discussion on the Cashless Pioneers Blog and subscribe for the latest news on the Engagement Bureau.

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