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UK consumers cautious on credit as high street spending slows
UK shoppers reduced their overall credit card outlay during September, as rising petrol prices and fuel bills continued to encourage cautious spending in the shops, according to data from MasterCard Europe.
The figures revealed that British consumers spent £2.59 billion on MasterCard branded credit cards during the month, 1.16 per cent down on August's figure of £2.62 billion. The total amount spent using MasterCard branded credit and debit cards also fell 3.5 per cent, to just under £5.41 billion.High Street retailers were amongst those worst hit by the reduced reliance on credit, with the aggregate volume of credit card purchases declining by 2.56 per cent to just under £1.01 billion. However, an even more dramatic fall in spending on debit cards, by 6.3 per cent to £1.42 billion, also contributed to an uncomfortable month in this sector.
Elsewhere on the High Street, the restaurant and recreation sectors also faced credit and debit card spending falls of 9.9 per cent and 3.9 per cent respectively, although the travel industry was less severely hit, witnessing a fall of just 1.1 per cent to £542.1 million.
Despite this news, online traders enjoyed an increase in volumes during the month, with the overall total value of transactions on credit and debit cards rising 1.62 per cent to just under £1.36 billion.
Commenting on the results, Brian Moore, Senior Vice-President, MasterCard Europe, said: “UK consumers are tightening their belts as they feel the financial pinch inflicted by rising petrol and fuel prices. The Bank of England cut interest rates in August in an attempt to reinvigorate High Street spending, but despite last week's decision to keep rates on hold, another cut may be necessary to boost growth.”
“These figures underline that shoppers are also conscious of the need to manage their disposable income sensibly. The reduced appetite for credit against a background of falling overall expenditure illustrates consumers' renewed appetite to monitor outgoings.
“The British publics' widely acclaimed ability to spot a bargain may also be fuelling the current overall growth in online shopping. Surfing the Internet to compare prices and take advantage of exclusive online offers may be becoming a regular habit for many people.”
Tagged as: mastercard | consumer spending | consumer
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