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New MasterCard Worldwide Index of Consumer Purchasing Priorities Shows Australians Balancing Discretionary Spending with Saving for Rainy Days

Sydney, 13 March 2009 – A MasterCard survey released today has revealed Australian consumers are among the least likely in Asia/Pacific to reduce their discretionary expenditure over the next 12 months. 53% of respondents in Australia said they would not cut back spending on items such as holiday trips, entertainment, dining out and luxury items. The figure is second only to the response from consumers in New Zealand (56%) and far exceeds the response from Chinese consumers (40%).

According to the MasterCard Worldwide Index of Consumer Purchasing Priorities, Australians spend an average of between 10-20% of their personal annual income on discretionary items. Some ten per cent of consumers spend 21-30% of their personal annual income on discretionary items, while forty-two per cent spend under 10%. Top spend items include dining and entertainment (60%), personal travel (59%) and fashion and accessories (54%).

This annual index provides valuable insights into consumers' savings and expenditure behavior and their discretionary spending priorities for the 12 months ahead. This year's Index is based on a survey of 6,019 consumers in 14 markets¹, conducted in Q4 2008. The Index and its accompanying reports do not represent MasterCard financial performance.

While Australians may continue to spend over the coming year, Dr. Yuwa Hedrick-Wong, economic advisor at MasterCard Worldwide in Asia/Pacific, says that Australian consumers may change their spending habits as a result of the economic crisis.

Consumers are spending "smart" and their purchasing priorities are being shaped by strong precautionary saving. While dining and entertaining, fashion and accessories, as well as personal travel remain the top priorities for Australian consumers, spending on auto and big ticket item consumer electronics are conspicuously absent among their top three spending priorities," Dr. Hedrick-Wong said.

Eddie Grobler, executive vice president, Australasia, MasterCard Worldwide, says:

"The findings of the survey do not spell doom and gloom, but rather suggest a shift in spending behavior within the retail sector."

When it comes to saving, the Index suggests on average Australians expect to save 1-10% of their total income over the next 12 months, and most (88%) consider saving to be important or very important. Of those Australians that do intend to save over the next 12 months, the top reasons for doing so are saving for emergencies (64%), retirement (61%), saving for investment (44%) and saving to buy property (21%).

"While it is a natural instinct to save in uncertain times, Federal Government's fiscal policy and the Reserve Bank's monetary policy are both designed to prevent 'rainy day saving' becoming a self fulfilling prophecy. It is important that Australian consumers continue to spend responsibly while keeping their personal debt at a manageable level, in order to fuel the economy and prevent that 'rainy day' from coming," says Mr Grobler.

"Australians should think about using the Government's stimulus package or future tax cuts to reduce their debts Consumer surveys² show that this is already being done by many Australians. The economy will benefit in the long term as discretionary income increases and debt reduces.s," he added.

Some twelve per cent of Australian respondent say they do not consider savings to be important. The top reasons for this are that they believe in enjoying life now as much as they can, they like to spend, and they have no problems earning money.

The survey also reveals a stark contrast in spending and saving habits across the population. Australia's under 30 single consumers and those that are divorced or widowed are the biggest spenders on fashion and accessories, where as Australians who are over 30, married and earn over $40,000 are the most strongly motivated towards precautionary saving.

More information on the Index can be found at the website
www.masterintelligence.com

The MasterCard Worldwide Index of Consumer Confidence and MasterCard Worldwide Index of Consumer Purchasing Priorities comprise part of the MasterCard Worldwide Index suite of research products in Asia/Pacific. The other key MasterCard Worldwide Index research products include the MasterCard Worldwide Index of Women's Advancement, the MasterCard Worldwide Centers of Commerce and the MasterCard Worldwide Emerging Markets Index.

Besides the suite of Indexes put forth by MasterCard, MasterCard also develops Insights reports as part of its series of ongoing research and analysis of business dynamics, financial policies and regulatory activities in the Asia/Pacific region. Sixty-three reports have been produced since 2004.

The suite of Indexes and reports do not represent MasterCard financial performance.

MasterCard Worldwide advances global commerce by providing a critical economic link among financial institutions, businesses, cardholders and merchants worldwide. As a franchisor, processor and advisor, MasterCard develops and markets payment solutions, processes approximately 21 billion transactions each year, and provides industry-leading analysis and consulting services to financial-institution customers and merchants. Powered by the MasterCard Worldwide Network and through its family of brands, including MasterCard^®, Maestro^® and Cirrus^®, MasterCard serves consumers and businesses in more than 210 countries and territories. For more information go to www.mastercard.com.

Percent of Income Expected to be Saved Over the Next 12 Months
(Survey Question: What percentage of your total income do you expect to save in the next 12 months?)

Markets	4Q 08 Base Total Resp.	Zero %	1% - 10% %	11% - 20% %	21% - 30% %	31% - 40% %	41% - 50% %	Over 50% %	DK/RFD %
Australia	400	21	40	7	8	4	2	2	16
China	602	5	27	29	17	6	7	6	3
Hong Kong	401	2	23	33	21	10	8	2	2
India	600	4	34	33	21	6	2	1	0
Indonesia	410	1	34	32	19	5	6	1	2
Japan	400	12	36	22	11	5	3	1	10
Korea	400	19	13	14	20	10	7	16	1
Malaysia	400	6	33	23	18	7	3	1	8
New Zealand/td>	400	22	21	21	9	6	2	2	17
Philippines	400	16	38	16	15	3	7	3	2
Singapore	406	7	26	24	16	13	4	4	5
Taiwan	400	2	15	26	31	14	9	2	1
Thailand	400	1	49	23	17	6	3	1	0
Vietnam	400	1	18	20	24	16	12	6	3
The Region	6019	8	29	24	18	8	5	3	5

Note: Percentages Read Across. Shaded Boxes Denote Average (Median).