Fiserv: Consumers Shifting Focus to Essential Spending

A new report from Fiserv shows a resilient, though far more cautious, American consumer.

The April edition of the payments and financial services company’s Small Business Index, published Monday (May 5), shows consumers are spending more on essentials while scaling back discretionary purchases, and spending less on restaurants.

“Even as consumer spending shows resiliency, market uncertainties appear to be driving budget-conscious consumers to reprioritize where they spend their money,” Fiserv Chief Data Officer Prasanna Dhore, said in a news release. “Small businesses providing the essentials, including healthcare and grocery, saw strong gains in the month; conversely, discretionary spending, including parts of travel and retail saw growth slow.”

Small business sales were up 3.2% on a year-over-year basis, with total transactions rising 6.9%, the report showed. Sales of services were up 3.6%, outperforming goods (2.2%), something Fiserv says has been the case for the whole of 2025 so far.

Meanwhile, small business restaurant sales showed modest growth year over year at 1.8%, falling 0.1% on a monthly basis, though foot traffic grew slightly.

“An increasingly budget-conscious consumer continues to show up most when dining out. Compared to 2024, average ticket sizes are down significantly (-7.8%) despite total transactions being up (+9.6%),” the release said.

The report showed slow growth in small business retail sales, led by grocery, clothing and building material purchases. Sales at gas stations were down 4.1%, with health and personal care retail spending dipping 1.9%.

Fiserv’s report is the latest in a series of indicators that consumers are focusing more on essentials, something shown last week in Block’s earnings.

Meanwhile, new research by PYMNTS, from the report “How Do Consumers Weigh Convenience Services Against Financial Pressure? It’s About Buying Time,” examines how people weigh the trade-off between time and money in terms of spending on things like grocery delivery, home maintenance and personal care.

“The research highlights that while these services offer valuable time savings, their cost represents a significant barrier to adoption and continued use for many consumers, especially those facing financial constraints,” PYMNTS wrote Monday. “Economic uncertainty means vulnerable income groups constantly evaluate their spending, with 67% of all consumers living paycheck to paycheck as of January.”

The report examines who uses convenience services, why some consumers scale back on spending and which factors would boost adoption. It shows that accessibility and the ability to pay are the chief drivers of usage.

“While saving time and reducing stress are strong motivations for using these services, the ability to afford them ultimately dictates whether consumers can put this desire into practice,” PYMNTS added. “The report underscores that cost concerns outweigh other elements like service quality when consumers decide whether to use or cut back on these services.”

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