Though payment card volume at many merchants is still down from a year earlier, a new report from Capital Access Network showed that the decline is slowing — and that spending at high-end restaurants is even increasing.

The New York company said Monday that credit and signature debit spending at small and midsize merchants in the second quarter was down 5.6% from a year earlier; the first-quarter figures were down 9.16% year over year, and spending in last year's second quarter was down 14.8% from a year earlier.

Capital Access did not provide dollar values for the spending patterns.

The decline in card sales seems to be moderating as the economy slowly recovers, Mark Lorimer, Capital Access' chief marketing officer, said in an interview.

The numbers are still below the "zero line" but are steadily increasing each quarter, he said.

Some areas are showing better results, notably high-end and established restaurants.

Restaurants in operation 10 to 15 years experienced a 4.18% increase in spending compared with about a 15% reduction a year earlier.

Restaurants in business more than 15 years experienced a 1.05% increase in card sales from about a 9.9% year-over-year decrease.

Restaurants with purchases averaging more than $100 reported a 2.75% increase in card sales, marking the first year-over-year card growth for this type of merchant since the third quarter of 2008, Lorimer said.

Card sales at these restaurants had declined annually by about 17.76% since the fourth quarter of 2008.

Established stores, open between 10 and 15 years, showed smaller declines than younger stores, with second-quarter card sales down 2.77%.

The slowing declines showed up in all regions except the Pacific states, where sales were down 12.48% from a year earlier, and the Rocky Mountain region, where sales were down 11.87%.
The report also shows a trend toward debit and prepaid card use among U.S. consumers, especially PIN debit cards.

Capital Access attributes the increase to banks restricting the availability of credit lines, causing some consumers to rethink how they pay for purchases, Lorimer said.

Capital Access expects to see an increase in credit card sales next year based on trends observed over the past few quarters, Lorimer said.

Capital Access Network buys future credit card receivables from small businesses.
Its data services unit compiled the report based on more than 10 million transaction details collected from more than 50,000 U.S. small and midsize businesses, some of which are customers.

The small and midsize merchants included in the report had average gross sales of $785,000 and average monthly card processing volume of $24,000.

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