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We’ve all heard that the recent economic difficulties have prompted more Americans to start paying down their debt, increase their overall savings rate, etc. As a part of this trend, credit card usage has reportedly declined.
Well… If you actually look at the numbers, you’ll see that reports of the demise of credit cards have been greatly exaggerated. Want proof? Check out this infographic from Index Credit Cards (below) that summarizes U.S. credit card usage.
In short… Yes, consumer debt has declined over the past few years for the first time in recent history – from a high of $974B in 2009 to just over $800B last fall – but credit card usage is still pervasive.
A few thoughts… For starters, I was a bit surprised by the large number of credit cards per cardholder. While I know that some people carry a wallet full of rewards credit cards, an overall average of 7.7 was higher than I would’ve expected.
Beyond that, I was impressed that American Express has a market share roughly equal to that of MasterCard. Given that AmEx isn’t as widely accepted, I expected this number to be lower.
At the same time, I would’ve expected Discover to have a bigger piece of the action. While they’re not explicitly listed, the big three account for 86% of all transactions, which means that Discover is embedded somewhere within the remaining 14% – presumably along with all of the store-branded credit cards, etc.
As for the individual usage statistics, these were much lower than I expected. An overall average of 119 credit card transactions per cardholder per year? That’s roughly once every three days. I don’t know about you, but I use a credit card way more often than that, and I charge significantly more than $10, 500 per year.