Credit card usage coming down in America

An interesting observation has come to the forefront regarding credit card usage amongst millions of customers. The usage of credit cards this holiday season has come down drastically compared to last year`s shopping season. This means that more and more Americans are actually visiting shopping malls with cash in their wallet rather than credit cards. According to one of the credit bureaus, over 8 million people have given up on using credit cards since the 3rd quarter of last year. A massive 78 million people now either don`t choose to own or have access to a credit card.

Part of the reason for this significant change in card usage is because even credit card issuers have become very strict when it comes to their lending standards. However, there is also a growing sign that some Americans are changing the way they spend. According to the analysis offered by TransUnion, one of the credit bureaus, a lot of consumers are making a genuine attempt at using credit cards in a more responsible fashion. For many people, this responsibility is a tough one when they approach their gift list for the year. According to some credit card customers, they are still paying for the debts that were made last year on credit cards for the gifts. However, some of the customers this year have simply decided to buy gifts this year on cash and pay them off immediately.

There are quite a few good examples of those who are in serious debt but are trying to pay the outstanding balances by going for debt consolidation. Such people are considering cutting back on their spending this holiday season, capping their expenses as far as the holiday gifts are concerned too. According to another finding of TransUnion, the overall debt on credit cards averages about 4964 dollars in the 3rd quarter of 2010. This number actually represents a slight increase from the 2nd quarter after we witnessed quite a lengthy period where it declined. However, this debt is still 11% less than the number over a year ago, when Americans started their holiday season with 5,612 dollars of average debt.

New incentives and reward programs have been introduced by credit cards in order to draw the customers back; however, the customers seem to have learnt a great lesson. Most customers who have no debt are also very keen to maintain the situation that way.

Jennifer Brown

Jennifer Brown, an external business consultant working with a Fortune 500 company, has years of experience to her credit. Despite having a busy schedule through the day, she takes time out to write articles dealing with credit cards, payday loans and other financial aspects. She has completed her Bachelor degree in Financial Services from Columbia University and has been actively involved in various activities for the betterment of society.