Mastercard Inc. credit cards
Benoit Tessier | Reuters
Mastercard CFO Sachin Mehra told CNBC that consumer spending in America is on track to exceed pre-pandemic levels, based on data from the company’s second quarter earnings report.
The payment giant reported Thursday that gross dollar volume, a metric that reflects buying activity, rose nearly 34% year over year to $ 619 billion in the US. That is 27% compared to the same quarter of 2019.
“People want to spend money and they are intent on doing that right now.” said Mehra in an interview on Thursday. “Does the stimulus play a role? Absolutely. Does the high level of savings that exist across the board play a role? We see. And we haven’t even seen travel return to the levels we saw before the pandemic. “
The spending trends also point to increased consumer confidence in the economic recovery, said Mehra.
“The past 12-18 months have been more about non-discretionary categories, groceries, utilities, things like that. We are now starting to see a shift towards discretionary categories, more on travel, more on accommodations, more on restaurants, “he added.” You are starting to see higher growth rates in credit. Debit numbers are also growing very well. “
Mastercard surpassed sales and profit estimates on Thursday.
On the conference call, CEO Michael Miebach said that in-store spending is returning, but there is a “secular trend versus cash” that is a catalyst for the digital payments business.
“The aversion to cash will advance contactless because it’s a cleaner form of payment.” said Mehra. “Contactless was on an upward trend, even before the pandemic. People have seen the convenience it offers and it has only accelerated. The US has always been a laggard when it comes to contactless, but that’s changing. The aversion to cash is a component. It’s just a good user experience. “