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Citing sluggish consumer and business spending, sales volume on MasterCard-branded credit and charge cards issued in the United States declined 14.2% during the third quarter ended Sept. 30, to $121 billion from $141 billion during the same period last year, MasterCard Inc. reported today. U.S. cardholders initiated 1.5 billion credit and charge card purchases, down 6.3% from 1.6 billion. There were 211 million MasterCard-branded credit and charge cards on issue at the end of September, down 20.4% from 265 million a year earlier. On MasterCard-branded debit cards, U.S. consumers spent $83 billion on purchases, up 6.4% from $78 billion. U.S. debit transactions, including PIN-debit purchases switched by competing brands appearing on debit MasterCards, reached 2.2 billion during the quarter, up 15.8% from 1.9 billion. There were 130 million MasterCard-branded debit cards on issue in the U.S. at the end of the quarter, up 4.8% from 124 million. Outside the U.S., sales volume on MasterCard credit and charge cards during the quarter totaled $239 billion, down 3.6% from $248 billion. Cardholders outside the U.S. generated 2.9 billion credit and charge card transactions, up 3.6% from 2.8 billion. There were 497 million MasterCard-branded credit and charge cards on issue outside the U.S., up 2.3% from 486 million a year ago. Debit card sales volume outside the U.S. totaled $36 billion, up 16.1% from $31 billion. The number of debit card purchases outside the U.S. totaled 613 million, up 27.7% from 480 million. There were 126 million MasterCard-branded debit accounts on issue outside the U.S. at the end of September, up 41.6% from 89 million a year earlier. MasterCard generated net income for the quarter of $452.2 million; it reported a net loss of $193.6 million for the same period a year earlier. Net revenue was $1.36 billion up 1.5% from $1.34 billion a year ago. MasterCard cut operating expenses during the quarter by 13.3% to $685 million from $790 million, as the company slashed advertising, marketing, personnel and administration costs. During a conference call today with analysts, MasterCard CEO Robert Selander said the economic downturn continued to dampen consumer and business spending during the quarter. Given recent spending trends, MasterCard "continues to have concerns about the health of the consumer," he said. However, MasterCard's October purchase volume looked more positive than a year ago, and certain global economic indicators also are improving, Selander noted. "The worst is behind us, and there are certainly some encouraging signs in the recent economic data," he added.
