Marqeta, the global modern card issuing platform, released its first Consumer Pulse Report today. Based on the findings of a February 2023 survey of 4,000 consumers across the US, UK and Australia, conducted on its behalf by Propeller Research, the report details the effects that dynamic economic circumstances and emerging financial technology are having on consumer behaviour.  
 
One key driver for many consumers surveyed: Economic anxiety due to rising costs and an uncertain job market. Amongst those surveyed, 61% of 26-50-year-olds reported that they’d changed their household budgeting due to the current economic circumstances, while roughly half of 18-25-year-olds and 51-64-year-olds said the same. When asked to recall a specific example of the economy impacting their spending habits, over half (57%) of respondents reported they have delayed at least one big purchase due to rising interest rates or the general state of the economy.
 
Housing provides one example of the impact of current economic circumstances. More than half (54%) of renters surveyed reported that their rent increased within the past 12 months. For prospective buyers, rising interest rates make purchasing a home more expensive, with over half (51%) of renters surveyed indicating that increased interest rates and the general state of the economy have led them to decide to delay purchasing a house.
 
The rapid pace of innovation in financial services was another influence on consumers this quarter. In response to emerging new tools and services, consumers are evaluating their options in relation to their needs and level of awareness of emerging financial services.

“Our report shows that in parallel to rising consumer uncertainties around escalating inflation, consumers are beginning to open themselves up to the unprecedented level of choice they now have in financial services,” said Rachel Huber, Market Intelligence Lead at Marqeta. “With the rise of digital banking and embedded finance options, it’s essential brands understand how expectations and preferences are being shaped by innovation and macroeconomic conditions.”

In addition to new offerings from their banks, consumers are also weighing a profusion of options from non-traditional providers via embedded financial services. Almost half (47%) of respondents reported that they would consider financial services from non-financial institutions like tech companies, social networks and retailers. Considerable education gaps still remain for these new banking options, however. Amongst consumers who had not considered these emerging financial services, 29% reported not being aware of these options and 36% indicated they don’t see the value of these new services.
 
Banking preferences provide one example of the effects of this environment of heightened choice. When respondents were presented with a list of newer digital banking features, approximately half indicated they were already using the tools or were interested in adopting in future.

Most popular were the well-established feature of overdraft protection and less common savings tools, like automated deposits into savings accounts and rounding up card purchases to the nearest dollar and depositing those funds into savings.
 
Consumer curiosity and exploration of cryptocurrency still remained high at the start of 2023: with consumers surveyed wanting more options for spending cryptocurrency, but still uncertain of the space. More than a quarter (27%) of those surveyed wished it was easier to spend against their cryptocurrency balances, with roughly the same percentage (28%) agreeing that the ability to make purchases with cryptocurrency is a significant benefit and makes shopping easier. Consumers want to use cryptocurrency, but still want the security of traditional accounts – a majority (59%) of respondents agreed that they would not be comfortable holding a significant portion of their savings in cryptocurrency.