Card delinquencies hit 22-year low

Frugal consumers, strong economy cuts late payments, says bankers group

Bank card delinquencies hit their lowest levels since June 1990 during the first quarter of this year, reflecting a stronger economy and tighter financial management by consumers, the American Bankers Association said July 9.

"Many consumers have learned the hard lessons of recession, and have redoubled their efforts to keep debt at manageable levels," ABA chief economist James Chessen said in a statement announcing the results of the association's Consumer Credit Delinquency Bulletin.

Late payments on bank cards fell to 2.41 percent of all accounts during the quarter, the lowest level in 22 years, ABA said. The rate was 2.47 percent in the previous quarter.

Accounts that are late paying by 30 days or more are counted as delinquent. The 15-year average rate for delinquencies was 3.87 percent of accounts.

The results reinforce previous findings that consumers are doing better with card debt. The Federal Reserve Bank of New York said previously that card balances and delinquencies both reached record lows for the post-financial crisis period during the first quarter.

The strong card payments were part of a broad improvement in consumer loan delinquencies, according to the banking industry association's figures. Eleven of 13 loan categories experienced lower delinquency rates during the quarter.

Chessen said that household wealth levels, boosted by higher prices for homes and stocks, also contributed to the strong repayment of consumer loans. Further improvement in the job market and continued discipline by consumers will be necessary for late payments to remain at low levels.

That discipline may be wearing down, as card balances leaped 9.25 percent during May, according to the Federal Reserve's G.19 consumer credit report.

"The future pace of delinquencies depends on a steadily improving labor market and strong financial health for consumers," Chessen said in the statement. "This will allow consumers to more easily meet their debt obligations."

See related: Best, worst states for credit card delinquencies

Join the discussion
We encourage an active and insightful conversation among our users. Please help us keep our community civil and respectful. For your safety, do not disclose confidential or personal information such as bank account numbers or social security numbers. Anything you post may be disclosed, published, transmitted or reused.

If you are commenting using a Facebook account, your profile information may be displayed with your comment depending on your privacy settings. By leaving the 'Post to Facebook' box selected, your comment will be published to your Facebook profile in addition to the space below.

The editorial content on is not sponsored by any bank or credit card issuer. The journalists in the editorial department are separate from the company's business operations. The comments posted below are not provided, reviewed or approved by any company mentioned in our editorial content. Additionally, any companies mentioned in the content do not assume responsibility to ensure that all posts and/or questions are answered.

Weekly newsletter
Get the latest news, advice, articles and tips delivered to your inbox. It's FREE.

Updated: 02-17-2019