How is Mastercard Making Circular Shopping Simple?
The fashion industry has a big impact on the planet, from the use of huge amounts of water, energy and chemicals to labour rights violations in the production of goods.
The World Economic Forum says that poor demand forecasts means that up to 40% of textile materials produced never reach an end consumer, instead end up being burnt or in landfill.
Mastercard has reported that people are now buying into second hand clothing more often, due to cost saving and environmental concerns.
Ellen Jackowski, Chief Sustainability Officer and EVP at Mastercard says: “Whenever I compliment someone on their clothing lately, it feels like half the time their response is, ‘Thanks! It’s a rental.’”
“Mastercard’s Economics Institute recently dug into this trend to analyse spending across online merchants who resell or rent clothing and accessories.
“The finding? Consumers’ spending at both luxury and mass circular fashion merchants has increased over the last few years, reaching new high shares of online US apparel spending in 2025—even exceeding post-pandemic highs.
“Today, about 27% of online apparel spent in the luxury market was at circular fashion merchants.”
What is circular fashion?
Circular fashion, in simple terms, means second hand or upcycled clothing.
Mastercard has reported that circular fashion is on the rise, using its anonymous data the company found that in 2024 around 27% of online apparel in the luxury market was at circular fashion shops.
On the whole mass circular retailers have held a steady market share at around 4%, but in 2024 it increased to 5.4%.
This percentage has remained consistent since the emergence of the covid pandemic, with those in city centres showing a higher tendency to spend on circular fashion items.
Even in the second hand clothing market people still buy into seasonal trends, the peak for circular fashion in the mass market was March, compared to overall online apparel peaking in November.
Mastercard reports that the trend is fitting due to merchants enticing shoppers in the winter months with discounts and Black Friday sales.
Michelle Meyer, Chief Economic, Mastercard says “Circular fashion is on the rise - we can see in our unique data.
“In this environment of trade tensions and potentially disrupted supply chains, the circular economy has the potential to gain momentum.”
What are the benefits of circular fashion?
Mastercard says that the acceleration in growth of luxury and mass circular fashion has several benefits for brands and consumers.
The increase in preloved clothing sales extends the lifecycle of quality goods, supporting sustainability in the fashion industry as it keeps items out of landfill.
Resellers are making a profit from clothes they have already worn and receiving some of its original value back when no longer wanted, as well as shoppers are able to buy better quality goods at a lower price.
Keeping clothing in circularity for longer can also be beneficial for brands as if items have a longer shelf life it extends the brand's visibility with younger shoppers and influencers.
“This shift not only extends the lifecycle of goods and reduces landfill waste but also provides economic benefits," Ellen continues.
“As economic uncertainty looms, shoppers can find great deals, and sellers find new homes for items. Businesses can tap into this trend, doing well while doing good for the planet.”
How is Mastercard getting involved in circular fashion?
Mastercard reports that cryptocurrency has started to emerge into the fashion industry.
Some brands are using crypto to make global transitions more simple and to support the rising demands for digital-native checkouts.
Mastercard released its Agent Pay in 2025 as an example of how AI could reshape what people buy and how they buy it.
The agent acts as a shopping assistant, browsing, recommending and completing purchases on the shoppers behalf.
Jorn Lambert, Chief Product Officer at Mastercard says: “Mastercard is transforming the way the world pays for the better by anticipating consumer needs on the horizon."
“The launch of Mastercard Agent Pay marks our initial steps in redefining commerce in the AI era, including new merchant interfaces to distinguish trusted agents from bad actors using agentic technology.”
