Credit Card Balances Reach 6-Year High
Credit card balances grew approximately 5% in 2014, the highest growth rate since the economy crashed in 2008.
The report from TransUnion showed that 157 million consumers had access to a credit card during the fourth quarter of 2014, which is 7 million more than the fourth quarter of 2013.
The average card balance per consumer did not vary from 2013 to 2014. The numbers moved from $5,330 per account in 2013 to $5,327 in 2014. TransUnion did not release a total dollar amount for balances in 2014.
TransUnion found consumers in the subprime and near prime credit tiers led to the majority of the growth in credit card balances during 2014.
“On the heels of a strong holiday shopping season, our data shows that consumers are charging more of their purchases, a positive sign for the credit card industry,” Nidhi Verma, director of research and consulting for TransUnion, said in a statement.
In regards to delinquencies, TransUnion found the number of accounts that were more than 90 days late fell slightly from 1.48% in 2013 to 1.47% in 2014. Delinquency rates only rose for consumers under 30. Those increased from 2.17% in the fourth quarter of 2013 to 2.25% in the fourth quarter of 2014.
“With a stabilized delinquency environment reflected by essentially the same delinquency rate as in Q4 2013, credit card balance growth generally reflects a healthy market with more consumers gaining access to credit and using that credit to make purchases,” said Verma.