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Written by Cyndie Martini
on November 24, 2020

Since the pandemic began, consumers have been aggressively paying their down credit card balances. The FED's October 7 G-19 Consumer Credit Report showed that banks are worse than credit unions. Bank customer credit card balances shrank twice as fast as those at credit unions.

For the month ending August 31, credit union credit card debt was down 4.7% compared to a year earlier. However, credit card debt for banks during the same period was down 9.7%. Since the pandemic started, consumer credit card debt has been on a steady decline.

For credit unions, they did gain share in the credit card space for September but then lost ground in auto loans. Across industries, credit card debt is decreasing while auto loans are increasing. Credit unions are gaining share in a shrinking market and losing it in a growing market. 

Compared to September 2019, the share of credit union credit card debt went from 6.2% to 6.4%. That's only a 0.2% change year over year but does, at least temporarily, slow the share decline in credit card debt that has been occurring all year.

Banks saw no change in their September 2019 to September 2020 share of credit card debt. It held steady at 89.6%.

Banks and credit unions aren't the only groups seeing a decline in credit card debt. All lenders have been affected this year.

Auto lending has seen a year over year increase. From September 2019 to 2020, there was a 3.6% increase. Auto lending has been on the rise since Q3 2019. The pandemic doesn't seem to have had any effect on auto lending. In fact, auto lending increased during the pandemic. 

Chief economist Steven Rick attributed the weak auto loan growth in the credit union space to “high economic uncertainty, low consumer confidence, and cash-out refinances paying off new auto loan balances.”

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