MasterCard Payments Update: Making the Most of an Economic Downturn

Q2 2008


No, consumer spending hasn’t dried up. But it has changed. Even with troubling economic indicators abound, people are still spending. Just not the same way they used to.

While U.S. spending growth has slowed—to 3.6% in March 2008 from 5.1% one year earlier—it is still growing. This issue of the MasterCard Payments Update sheds light on new consumer spending patterns during uncertain economic times and suggests strategies to make the most of them.

Most consumers are now employing value spending instead of the more confident style of the recent past. This entails shifting money from discretionary purchases to non-discretionary ones. People are willing to forego convenience, style and indulgence in order to continue to spend on quality, durable necessities. Tradeoffs are common. For example, parents will cut personal spending to continue to spend on their children.

The question, of course, is how to make the most of these times? This update recommends several strategies for financial institutions including, motivating profitable behaviors by targeting best opportunities; driving card usage in segments that continue to spend; managing risk appropriately; and managing costs by minimizing fraud.


We bring together leading economists, social scientists, and other experts to create measures of global finance.

This work results in ground-breaking, actionable studies and indexes that chart the latest trends driving commerce around the world.

These are the Insights that inform the most important business decisions. And these are the Insights that help businesses create trends of their own.

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