CUSO-News---Payments-Report

close

Categories

More Tags

Subscribe to Email Updates

Popular Stories

The Quick On Visa’s 8-Digit Bin Migration
Do Credit Unions Have A High Barrier To Entry Problem?
Biometric Authentication Adoption by Credit Unions
2022 Credit Card Trends
3 Payments Trends For 2022
Written by Cyndie Martini
on February 08, 2022

While it is still early in the year, we can already make a few assumptions about what consumers will be doing with their credit cards.

Increased Balances

According to a recent TransUnion report, credit card balances are expected to continue increasing in 2022 but remain below 2019 levels. 

As stimulus money has been all but exhausted by consumers at this point, they have switched from debit cards to credit cards. This can be seen in the continued increase in credit card balances. It also helps that credit card companies are increasing credit limits for consumers, in some cases automatically and without any intervention from consumers.

Credit card companies are willing to increase credit limits because delinquency rates remain low and the economy is normalizing post-pandemic (i.e., services spending is increasing). This will have an overall effect of loosening credit restrictions. Delinquency rates are expected to remain low as consumers have the option to tap into the increased value of their homes via equity credit.

As consumers begin venturing out more and spending on services increases, credit card balances will increase as well. Think of larger ticket items such as travel and all that it encompasses.

Credit Card Companies Implementing Their Own BNPL Option

BNPL seems to be everywhere. It's also a direct competitor to credit card payments. Credit card companies are introducing their own form of BNPL. One example is American Express' Pay It Plan It. Customers don't have to put a large payment on their card with the Amex option. They can pay it off in equal installments, just like other BNPL plans.

One disadvantage of BNPL is that it does not report payment history to credit bureaus. But that is changing. Equifax is working with companies that use BNPL so that customers using BNPL can build their credit history as if they were making regular credit card payments.

 

 

Let Us Know What You Thought about this Post.

Put your Comment Below.

You may also like:

Credit Cards

Credit Card Balances are Trending to Pre-pandemic Levels

Credit card balances took a dive in 2020. They are now on the rise and heading back to pre-pandemic levels. Just before ...

Credit Cards

Card Magnetic Stripes Get The Boot

Credit and debit card magnetic stripes are basically relics. But in the U.S., they are still ubiquitous because our paym...

Credit Cards

The Latest Revolving and Consumer Credit Data

During 2020, consumers paid down large amounts of credit card (i.e., revolving credit) debt. That's no secret. However, ...