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First Data: Payment transactions rise in August

August was a difficult month for the American economy, but back-to-school promotions coaxed more consumers into shopping with their credit and debit cards, according to payment processor First Data.

The company also found that while the number of electronic payment card transactions grew at foodservice operations in August, the average ticket amount fell as a result of discounting.

According to First Data, a payment processor based in Atlanta, overall year-over-year same-store transaction growth was 7.2 percent in August, compared with 6.2 percent in July.

That gain marked the largest total increase in payment card transactions in six months.

First Data’s August 2011 “SpendTrend” report found that payment card transaction growth at restaurants outpaced that of most other industries, although discounting led to slower sales growth.

Same-store payment card transactions in August rose 9.3 percent at restaurants, compared with a year earlier, second only to the 9.7-percent gain in the services sector.

Restaurants have been near the top of transaction-growth figures for the past trailing four quarters, according to First Data reports, regularly ranking ahead of the retail, travel, hotel and gasoline station segments.

From the third quarter of 2010 through the second quarter of 2011, quarterly transactions increased 11.2 percent, 11.9 percent, 10.4 percent and 10 percent, respectively.

However, same-store dollar volumes measured by First Data’s payment card tracking in August grew only 6.2 percent at restaurants. That result reflected a 2.8-percent decrease in average ticket at restaurants for the month, the largest decline for any industry in August.

Restaurants’ average-ticket declines — which First Data calculates by dividing the total dollar amount of same-store sales for a specific period by the number of payment card transactions in that period — had been narrowing in the trailing four quarters, posting losses of 4.3 percent, 3.5 percent, 2.7 percent and 1.7 percent, respectively.

More generally, consumers’ use of their credit cards continues to grow, First Data found. Same-store dollar volume for credit cards rose 12.4 percent in August and transactions from credit cards increased 11.7 percent, both 13-month highs.

The payment processor also found that consumers are increasingly using credit for nondiscretionary purchases, like gasoline and groceries.

First Data is a global technology and payment processing firm, which services more than five million merchant locations, more than 2,000 credit and debit card issues, and millions of consumers worldwide.

Contact Mark Brandau at [email protected].
Follow him on Twitter: @Mark_from_NRN

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