Credit Card Facts & Statistics - Debt, Spending & More [2023]

Q: What do banks consider when issuing credit cards?

Banks consider the following when issuing credit cards: Credit Score: Credit card issuers look at your credit score to determine a risk factor in issuing you a credit card. This helps the issuers determine how likely it is that you will be able to repay your credit card debt. Delinquencies: Credit card issuers will look at any past due accounts and late payments. Credit Inquiries: Hard credit inquiries occur when you apply for some sort of credit account and the company looks into your credit. Too many hard inquiries can be a red flag to many credit card issuers. Debt to Income Ratio: Credit card issuers want to know you can afford to pay your debts. They will look at your overall income and compare with your debt to make sure they are not lending out more than you can pay. Available Credit Usage: Credit usage is an important factor to credit card issuers. This reflects how much of your available credit you are using. If you have multiple maxed-out credit cards, but you pay all of them on time, you are still using a good portion of your available credit. A good rule of thumb is to use less than 30% of your total credit.

It may seem like every other piece of mail you get is a “You’re approved!” letter from a credit card company or the option to finance literally anything, which is just so tempting. Want that new Peloton bike? Well, it could be yours for just $39 a month! While this may seem like a good deal, it’s easy to find yourself spending too much, sinking into a bit of debt (or a lot), and having way too many credit cards.

Spending on credit cards is easy by design. All it takes is a swipe, and that shiny new toy is yours. If this sounds all too relatable, you’re not alone. During the fourth quarter of 2021, credit card balances in the U.S. increased by $52 billion, the largest quarterly increase observed in the 22-year history of the data, according to the “Quarterly Report on Household Debt and Credit,”¹ released by the Federal Reserve Bank of New York.

That may seem like a substantial increase, but credit card balances are actually $71 billion lower than at the end of 2019, and as of 2021 the average American carries $5,525 in credit card debt, declining 6%, according to data from Experian’s “State of Credit 2021” report.²

Keep reading to find out more credit card facts and statistics, including credit card spending statistics, average credit card debt, spending habits when it comes to cash vs. credit cards, what banks look at when issuing credit cards, how to get a credit card, and frequently asked questions.

Table of contents

13 Quick Credit Facts and Statistics
U.S. Credit Card Statistics by Generation, Income, and Ethnicity
The Difference Between a Credit Card Issuer and Network
Credit Card Spending Habits in the U.S.
Credit Card Debt in the U.S.
Cash vs. Credit Cards
Final Thoughts

Table of Contents

13 Quick Credit Facts and Statistics
U.S. Credit Card Statistics by Generation, Income, and Ethnicity
The Difference Between a Credit Card Issuer and Network
Credit Card Spending Habits in the U.S.
Credit Card Debt in the U.S.
Cash vs. Credit Cards
Final Thoughts

13 Quick Credit Facts and Statistics

The average number of credit cards per person in the U.S. is 3.8.³
Gen Z holds the lowest average number of credit cards at 1.7.⁴
Adults with an income under $100,000 who have credit cards are more likely to use them to carry balances from month to month.³
87% of white adults, 92% of Asian adults, 72% of Black adults, and 76% of Hispanic adults have credit cards.³
There are credit card issuers and credit card networks. A credit card issuer is a financial institution that gives you a credit card. A credit card network is a company that provides a communication system between a merchant and an issuer.
Credit card networks include Visa, Mastercard, American Express, and Discover.
The 7 largest credit card issuers generated $3.517 trillion in purchase volume in 2021, up 25.6%. They accounted for 77.1% of the industry’s $4.564-trillion total.⁵
Studies show that shoppers with credit cards are willing to spend more on items, check out with bigger baskets, and focus on and remember more product benefits rather than costs.
The average credit card debt per household is $8,590.⁶
Credit card debt was the most widely held type of debt as of 2019.⁷
Americans in the 90th to 100th annual income percentile had an average credit card debt of $12,600.⁸
Credit cards as a form of payment have increased since 2016, increasing from 24% of payments in 2019 to 27% of payments in 2020.⁹
Debit cards remain the most frequently used form of payment, accounting for 10 of the 35 payments made, and a 28% share of payments.⁹

U.S. Credit Card Statistics by Generation, Income, and Ethnicity

1. The average American holds 3 credit cards.

According to the “Report on the Economic Well-Being of U.S. Households in 2020,”³ 83% of adults had a credit card in 2020. The average number of credit cards per person in America in 2021 is 3.

2. Gen Z holds the lowest average number of credit cards.

Baby boomers hold the highest average number of credit cards at 5, and Gen Z holds the lowest average number of credit cards at 1.7.⁴

3. Adults with an income under $100,000 who have credit cards are more likely to use them to carry balances from month to month.

When you break down credit card ownership by income, the results are interesting. Most people with an income of over $100,000 have a credit card. Adults with an income under $100,000 who have credit cards are more likely to use them to carry balances from month to month.³

4. 87% of white adults, 92% of Asian adults, 72% of Black adults, and 76% of Hispanic adults have credit cards.

Credit card usage also varies by race and ethnicity. 87% of white adults have a credit card and 44% of those credit card users have carried over a balance at least once in the past year. Over 90% of Asian adults have a credit card, but just 3 in 10 Asian adults have carried a balance at least once in the past year. Meanwhile, Black and Hispanic adults were more likely to carry balances on their credit cards than other racial or ethnic groups. Of the 72% of Black adults who hold credit cards, over 70% of them have carried a balance at least once in the past year. 76% of Hispanic adults hold credit cards and 64% have carried a balance at least once in the last year.³

Credit Card Statistics by Ethnicity — Image Credit: Upgraded Points

Similar patterns are seen with education levels, as well. More-educated adults are more likely to have a credit card and less likely to carry a balance from month to month.

When looking at credit card debt by race, you also see a slight difference. According to creditrates.com, white cardholders have $7,942 in credit card debt, Asian cardholders carry $7,660 in credit card debt, Hispanic cardholders have $6,849, and Black cardholders have $6,172 in credit card debt.

Hot Tip: For more information, check out our article on credit card ownership stats by income, education, credit score, and more.

The Difference Between a Credit Card Issuer and Network

5. What is the difference between a credit card issuer and a credit card network?

While there are many credit card issuers out there, there are only a select few credit card networks. So what exactly is the difference between a credit card issuer and a credit card network?

A credit card issuer is a financial institution that gives you a credit card. For example, Chase, Wells Fargo, U.S. Bank, and Bank of America are all credit card issuers. A credit card network is a company that provides a communication system between a merchant and an issuer in order to complete a credit card transaction.¹⁰ Visa, Mastercard, American Express, and Discover are credit card networks.

6. Credit card networks include Visa, Mastercard, American Express, and Discover.

Some credit card networks are more popular than others. When looking at the number of cards circulating for each network in the U.S. at the end of 2020, the difference is ostensible.

Visa: 340 million credit cards in circulation¹¹
Mastercard: 246 million credit cards in circulation¹²
Discover: 57 million credit cards in circulation¹³
American Express: 53.8 million credit cards in circulation¹⁴

Ranking Popular Credit Card Networks by Popularity — Image Credit: Upgraded Points

Credit Card Spending Habits in the U.S.

7. The 7 largest credit card issuers generated $3.517 trillion in purchase volume in 2021, up 25.6%. They accounted for 77.1% of the industry’s $4.564-trillion total.

According to the 2022 Nilson Report,⁵ the breakdown of purchase volume from the top issuers of general-purpose credit cards in the U.S. is below:

Chase: $950 billion
American Express: $868 billion
Citi: $483 billion
Capital One: $455 billion
Bank of America: $414 billion
Discover: $182 billion
U.S. Bank: $166 billion

Credit Card Statistics by Purchase Volume — Image Credit: Upgraded Points

8. Studies show that shoppers with credit cards will spend more on items, check out with bigger baskets, and focus on and remember more product benefits rather than costs.

Credit cards are an easy scapegoat when overspending occurs and might actually be the right source of blame. According to the “Neural Mechanisms of Credit Card Spending” report,¹⁵ studies show that shoppers with credit cards will spend more on items, check out with bigger baskets, focus on and remember more product benefits rather than costs, and make more indulgent and unplanned purchase choices.

Hot Tip: Learn more in our detailed look at credit card spending facts and statistics.

Credit Card Debt in the U.S.

Credit Card Debt Statistics 1 — Image Credit: Upgraded Points

9. The average credit card debt per household is $8,590.

The average credit card debt per household in the U.S. is $8,590, as of Q4 2021, according to Wallethub.⁶

10. Credit card debt was the most widely held type of debt as of 2019.

The Federal Reserve also reported that credit card debt was the most widely held type of debt as of 2019, with more than 45% of families reporting a credit card balance after their last payment.⁷

11. Americans in the 90th to 100th annual income percentile had an average credit card debt of $12,600.

When broken down by household income, it may come as no surprise that the higher the household income, the greater the credit card debt. Americans in the 90th to 100th annual income percentile had an average credit card debt of $12,600.⁸

Cash vs. Credit Cards

12. Credit cards as a form of payment have increased since 2016, increasing from 24% of payments in 2019 to 27% of payments in 2020.

According to the “2021 Findings From the Diary of Consumer Payment Choice,”⁹ a survey by the Federal Reserve, cash’s share of all payments decreased by 7% in 2020. Credit cards as a form of payment increased since 2016, increasing from 24% of payments in 2019 to 27% of payments in 2020. This could be because of the pandemic and shoppers doing most of their shopping online or using credit cards as a way to have less contact with others.

13. Debit cards remain the most frequently used payment type, accounting for 10 of the 35 payments made, and a 28% share of payments.

However, the findings from the survey say the increase in credit cards’ share of payments was primarily driven by a decrease in using other payment instruments rather than a direct increase in the use of credit cards; the number of reported credit card payments remained steady from 2019 to 2020 at 9 payments per month. The Federal Reserve says for the first time since the start of the Diary in 2016, credit cards’ share of payment usage surpassed cash. Debit cards remained the most frequently used payment type, accounting for 10 of the 34 payments made (in October 2020, U.S. consumers reported making an average of 34 payments per month), and a 28% share of payments.

Final Thoughts

Based on the above credit card facts, it doesn’t seem like credit card spending or debt is going away soon. If you are considering putting that large purchase amount on your credit card for the points or thinking about opening a new credit card to make a balance transfer, remember these are still things you will need to pay off and if not paid off in full every month, you will incur the hefty interest charge. Take into consideration all the facts listed above before getting yourself into unneeded debt.

References

¹ Federal Reserve Bank of New York. (2022 February). Quarterly Report on Household Debt and Credit. https://www.newyorkfed.org/medialibrary/interactives/householdcredit/data/pdf/HHDC_2021Q4
² Wendel, S. (2021, September 7). State of Credit 2021: Rise in Scores Despite Pandemic Challenges. Experian. https://www.experian.com/blogs/insights/2021/09/state-of-credit-2021/
³ The Federal Reserve. (2022, June 13). Economic Well-Being of U.S. Households in 2020 – May 2021. https://www.federalreserve.gov/publications/2021-economic-well-being-of-us-households-in-2020-banking-and-credit.htm
⁴ Stolba, S. (2022, February 13). Millennials vs Baby Boomers: Who Has More Credit Cards? Experian. https://www.experian.com/blogs/ask-experian/research/millennials-vs-baby-boomers-who-has-more-credit-cards/
⁵ Nilson Report. (2022 February). Top Issuers of General Purpose Credit Cards in the U.S. https://nilsonreport.com/upload/Cover-1214-600.gif
⁶ Comoreanu, A. (2022, August 18). Credit Card Debt Study. WalletHub. https://wallethub.com/edu/cc/credit-card-debt-study/24400
⁷ Bhutta, N., Bricker, J., Chang, A., Dettling, L., Goodman, S., Hsu, J., Moore, K., Reber, S., Volz, A., Windle, R. (2020). Changes in U.S. Family Finances from 2016 to 2019: Evidence from the Survey of Consumer Finances. The Federal Reserve. https://www.federalreserve.gov/publications/2020-bulletin-changes-in-us-family-finances-from-2016-to-2019.htm
⁸ The Federal Reserve (2022, March 10) Survey of Consumer Finances (SCF). https://www.federalreserve.gov/econres/scfindex.htm
⁹ Coyle, K., Kim, L., O’Brien, S. (2021, May 5). 2021 Findings from the Diary of Consumer Payment Choice. Federal Reserve Bank of San Francisco. https://www.frbsf.org/cash/publications/fed-notes/2021/may/2021-findings-from-the-diary-of-consumer-payment-choice/
¹⁰ Cothern, L. (2021, March 5). What Is a Credit Card Network and How Do They Work? Credit Karma. https://www.creditkarma.com/credit-cards/i/credit-card-networks
¹¹ Visa (n.d.) Operational Performance Data. https://s1.q4cdn.com/050606653/files/doc_financials/2021/q1/Visa-Inc.-Q1-2021-Operational-Performance-Data.pdf
¹² Mastercard (n.d.) Supplemental Operational Performance 2019Q1–2021Q1. https://s25.q4cdn.com/479285134/files/doc_financials/2021/q1/1Q21-Supplemental-Operational-Performance-Data.pdf
¹³ Kiernan, J. (2022, August 10). List of Credit Card Companies & Major Cards. WalletHub. https://wallethub.com/edu/cc/credit-card-companies/20409
¹⁴ American Express (n.d.). 2020 Annual Report. https://s26.q4cdn.com/747928648/files/doc_financials/2020/ar/2020-Annual-Report-(1).pdf
¹⁵ Banker, S., Dunfield, D., Huang, A., Prelec, D. (2021, February 18). Neural Mechanisms of Credit Card Spending. Scientific Reports. https://www.nature.com/articles/s41598-021-83488-3

Featured Image Credit: Upgraded Points

Frequently asked questions

What is considered good credit?

In general, considering the different credit scoring models, the typical ranges for a credit score being good or bad include the following:

750 or higher – Excellent
700 to 749 – Good
650 to 699 – Fair
600 to 649 – Poor
Below 600 – Extremely Poor

What happens if I max out my credit cards?

When you max out a credit card you can expect your monthly payments to increase and future transactions to be denied until you lower your balance. You also risk the potential for your credit score to drop. Maxing out your credit card increases your credit utilization ratio, which is the amount of credit you are using compared to the amount you have available.

What happens if I don’t make the minimum payment on my credit card?

If you consistently make less than the minimum payment on your credit cards, it will eventually end with you defaulting on your account (unless otherwise discussed with your credit card issuer).

What is the average interest rate on a credit card?

The average credit card interest rate is 16.16%.

Will too many credit cards hurt my credit?

The number of cards you have does not directly influence your score and it’s not part of the calculation of your score. If having more cards means you use less of your available credit (credit utilization), then this actually helps to increase your score.

What are the most popular credit card companies?

American Express, Bank of America, Capital One, Citigroup, Discover Financial, JPMorgan Chase, Synchrony Financial, and U.S. Bancorp are the most profitable payment card companies in the U.S., according to the Nilson Report.

What is the difference between a secured credit card and a credit card?

For unsecured credit cards, credit card companies will require at least average credit. Unsecured credit cards don’t require a deposit.

A secured credit card requires a deposit when opening the account. This deposit reduces the risk the credit card issuer will take when issuing the card. If you miss a payment, the credit card issuer will take the money from your deposit and pay the balance. Secured credit cards are typically for people with bad or no credit.

What is an annual fee on a credit card?

An annual fee on a credit card is a price that you have to pay once a year to remain a cardholder and receive the card’s benefits. There is no set price range for an annual fee and it typically depends on the type of card and type of rewards.

How do I know which credit card rewards program is right for me?

There is no “one size fits all” rewards credit card. It is going to depend on if you want a travel rewards card or a cash-back card. Think about how you spend your money and what kind of rewards you would like to receive from your card, then do your research.

What do banks consider when issuing credit cards?

Banks consider the following when issuing credit cards:

Credit Score: Credit card issuers look at your credit score to determine a risk factor in issuing you a credit card. This helps the issuers determine how likely it is that you will be able to repay your credit card debt.
Delinquencies: Credit card issuers will look at any past due accounts and late payments.
Credit Inquiries: Hard credit inquiries occur when you apply for some sort of credit account and the company looks into your credit. Too many hard inquiries can be a red flag to many credit card issuers.
Debt to Income Ratio: Credit card issuers want to know you can afford to pay your debts. They will look at your overall income and compare with your debt to make sure they are not lending out more than you can pay.
Available Credit Usage: Credit usage is an important factor to credit card issuers. This reflects how much of your available credit you are using. If you have multiple maxed-out credit cards, but you pay all of them on time, you are still using a good portion of your available credit. A good rule of thumb is to use less than 30% of your total credit.

How do I choose a credit card?

There are certain factors that are important to consider when choosing a credit card that is right for you. Do you want to do a balance transfer, are you comfortable paying an annual fee, what is the interest rate, do you care about points/rewards, etc.

Interest Rate: Some cards offer no interest for the first year or a certain amount of months, but after that promotional period of time is over, what will the interest rate be?
Annual Fees: There are cards out there that don’t have annual fees. Do some research before you commit to a card with a fee.
Other Charges: Some cards will charge fees on certain transactions like balance transfers, foreign transactions, and cash advances. Take a look at these fees and think about if it’s something you should be concerned about.
Rewards Programs: If the card has an annual fee, does the rewards program outweigh the fee? Do you want to earn miles, cash-back, or points? Choose a card that has a rewards program geared towards how you spend your money.

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