Most U.S. cardholders carry at least one balance
Majority have a mix of general purpose and private label credit cards
Data whiz and visual storyteller
More than half of U.S. credit card holders have both general purpose and private label cards, and except for those with the highest credit scores, most Americans are carrying a balance on at least one of those cards.
That’s according to the Consumer Financial Protection Bureau’s December 2017 report on the U.S. credit card market. It found that of the 169 million Americans who had a credit card at the end of 2017’s second quarter, 53 percent (90 million) had a combination of both general purpose cards, such as those issued by Visa, Mastercard and Discover, and private label cards, which are issued by stores, brands and retailers for use only with that merchant.
The remaining cardholders were made up of the 40 percent who exclusively had general purpose cards and a 7 percent sliver who reported nothing but private label cards.
Looking at all cards, the CFPB reported that U.S. adults had a total of 659 million open accounts, averaging 3.9 cards per consumer. Among those with a general purpose card, the average was 2.8 general purpose cards per person. For private label cardholders, the average was 2.2 private label cards each.
With 93 percent of all American cardholders reporting at least one general purpose card, the number of those cards outnumbers private label cards by almost 2 to 1. But the division between general purpose and private label spending is another story. Although 34 percent of cards are private label, they were used for only 11 percent of 2016’s annual credit card spending.
In its wide-ranging report, the CFPB also examined how many Americans carry a card balance from month to month, and how that varies among general purpose and private label cards.
Taking the data in its simplest form, about 43 percent of general purpose cards have revolving balances. But that average can be misleading, since consumers with the highest credit scores are holding the average far below the revolving rate of lower credit tiers.
In fact, except for super-prime general purpose accounts — held by those with a credit score of at least 720 — the percentage of cards with a carried balance ranges from 65 percent all the way to 85 percent, increasing with each riskier credit score tier. In contrast, only 27 percent of the super-prime accounts are revolving.
Americans are slightly better at paying off their private label cards, the CFPB finds. Here the average is 29 percent who have a carried balance.
But just as with general purpose cards, super-prime borrowers are holding the average down, with just 17 percent of super-prime private label accounts showing a revolving balance. Move to the higher-risk credit tiers and the percentage with carried balances ranges from 41 percent up to 73 percent.
A federal agency, the CFPB collects credit card data on a quarterly basis as well as year-end annual figures. Last prepared in 2015, its 2017 report titled “The Consumer Credit Card Market” was released on Dec. 27.
- Older millennials prefer paying with debit, unlike other groups under 55 – A recent survey shows older millennials stand alone among the under-55 crowd in preferring to pay with debit over credit. However, Gen Z is evenly split between the two ...
- Retailers say ‘Less signing, more PINs’ for credit card purchases – No-signature retailers may be more common than signature retailers within the next year, according to a new study ...
- Millennial mobile payment users display costly card habits – Millennial mobile payment users have more assets, higher incomes and higher levels of education than non-users, but they're also more likely to pay only the minimum on their cards and incur late fees, new research shows ...