Americans Cut Credit Card Delinquencies to 2.92% as Q1 Balances Dip to $1.25 Trillion
Updated
Updated · WOLF STREET · May 20
Americans Cut Credit Card Delinquencies to 2.92% as Q1 Balances Dip to $1.25 Trillion
1 articles · Updated · WOLF STREET · May 20
Q1 credit card delinquencies fell again, with the 30-plus-day rate at commercial banks dropping to 2.92% from 3.06% a year earlier, the lowest since Q2 2023.
A post-pandemic "free-money" hangover has kept easing, while the usual pullback after holiday spending helped statement balances fall $28 billion, or 2.2%, from Q4 to $1.25 trillion.
Other measures also improved: 60-plus-day delinquencies slipped to 2.97% overall, and prime cardholders' 60-plus-day rate dipped to 0.94%, below pre-pandemic lows.
Consumer spending still grew, just moderately—credit card balances were up 5.9% year over year, while total revolving consumer credit rose 5.2% to $1.81 trillion.
Household credit strain remained contained, with revolving debt at 7.72% of disposable income, aggregate card limits hitting a record $5.5 trillion, and unused available credit reaching $4.23 trillion.
With overall delinquencies falling, why are banks expanding risky loans to the most vulnerable consumers?
As prime borrowers thrive, is a hidden debt crisis brewing for millions of other Americans?