Delinquency Rates Down Despite High Credit Card Usage

Delinquency Rates Down Despite High Credit Card Usage

May 9, 2018         Written By Bill Hardekopf

According to the latest TransUnion Industry Insights report, credit card usage in America is at a record high. There are 416 million credit cards in use among 175 million consumers. This is a 22% increase in the number of cards when compared to the 340 million credit cards in use during 2012.

Despite the high usage rates, delinquency rates in the first quarter 2018 are consistent with those of the first quarter of 2012 (1.78% and 1.77%, respectively). This is below the 10-year average of 1.91%.

This shows consumers are now doing a better job in managing their credit cards, even though there are more cards available. Paul Siegfried, Senior Vice President of TransUnion, says this is because:

  1. Credit card issuers are primarily lending to low-risk consumers.
  2. Issuers are providing lower credit limits to consumers in all risk brackets.
  3. The economy is growing as a whole, allowing consumers to pay their credit cards with minimal delinquencies.

Earlier this year, the Federal Reserve reported revolving debt, which mostly consists of credit cards, was at an all-time high of $1.023 trillion. Even though that is higher than the debt rates before the recession, the economy today is stronger than it was 10 years ago.

Americans need to continue to use their credit wisely: borrow with a realistic repayment plan, use the lowest amount of credit necessary, and pay down debts before borrowing more. This will keep delinquency rates at bay and facilitate financial success in the future.



The information contained within this article was accurate as of May 9, 2018. For up-to-date information on any of the terms, cards or offers mentioned above, visit the issuer's website. Many of the offers on this article are from our affiliate partners, and LowCards.com may be compensated if you take action with any of our affiliate partners.


bill-hardekopf

About Bill Hardekopf

Bill Hardekopf is the CEO of LowCards.com and covers the credit card industry from all perspectives. Bill has been involved with personal finance for over 15 years. He is a frequent contributor to Forbes, The Street and The Christian Science Monitor.
View all posts by Bill Hardekopf
Featured No Annual Fee Card
Top Features : Earn cash back twice. 1% when you buy plus 1% as you pay; 0% APR for 18 months on balance transfers
Featured Low Interest Card
Top Features : No annual fee; $150 statement credit after spending $1,200 in first 90 days; 0% on Purchases for 12 months and Balance Transfers for 18 months
Featured Balance Transfer Card
Top Features : 0% APR for 21 months on Balance Transfers and 12 months on Purchases; no annual fee, late fee or penalty rate
Featured Bad Credit Card
Top Features : Reports to all three credit bureaus, perfect credit not required for approval
Featured Fair Credit Card
Top Features : All credit types welcome to apply!