Credit Card Use Declined in March - Other News


ADVERTISING DISCLOSURE: is an independent, advertising-supported web site. receives compensation from most credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » News » Other » Credit Card Use Declined in March

Credit Card Use Declined in March

The content is accurate at the time of publication and is subject to change.

The latest data from the Federal Reserve Bank of New York shows the smallest in increase in consumer borrowing in eight months. Borrowing in March was a seasonally adjusted $2.81 trillion—an increase of $8 billion. The slight rise is attributable entirely to student debt and auto loans, not credit cards. School and car loans were up $9.7 billion for a total of$19.6 trillion.

Credit card debt fell by $1.7 billion to a total of $846 billion; that’s 17.2% lower than when it reached its highest point almost five years ago. In July 2008, just before the economic crash, credit card debt set a record of $1.022 trillion. Since then consumers have become more cautious about taking on additional debt.

Economists say that the increase in Social Security taxes could be partly behind the current consumer reluctance to charge purchases to their cards. The change in tax law has reduced take-home pay for many Americans, who are still in recovery from the recession. An individual who earned $50,000 last year would have to pay about $1,000 more in taxes this year than last, due to new tax regulations.

Back to school

When it comes to taking on debt, Fed data indicates that many people are choosing to apply for student loans rather than credit cards, hoping that going back to the classroom will result in a better job with increased earning power.

The Fed lumps student loans in with car loans, so it isn’t possible to say for sure how much of March’s $9.7 billion increase in that category went toward student loans. But at least one economist has estimated that nearly 80% of that amount went to student debt, not car financing.

Quarterly data from the Federal Reserve indicates that student loan debt has been the fastest growing category of consumer borrowing since June 2009. But now that employment is rebounding, school enrollment could slow down as people return to work. In April, the U.S. economy added 165,000 jobs and the unemployment rate was at a four-year low of 7.5%.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
Add to Favorites:

Related News:

College Students Using Less Credit Cards
College Students Using Less Credit Cards

Posted: April 26, 2013

Credit card use is down among college students according to a Sallie Mae study. Those who do have credit cards, use them carefully it says — three-quarters carry an average balance of less than $500, and 33% of them don’t carry a balance… Continue reading

Credit Card Write-Offs Decrease as Balances Increase
Credit Card Write-Offs Decrease as Balances Increase

Posted: December 29, 2014

Credit balances were at their highest level in five years as of November 2014, according to Equifax’s National Consumer Credit Trends Report. Not including mortgages, credit balances from auto loans, store credit cards and bank credit… Continue reading

Back-to-School Means Big Bucks
Back-to-School Means Big Bucks

Posted: July 26, 2013

Back-to-school shopping is expected to increase this year with new clothes at the top of the list, according to a new study. Extracurricular activities like sports and music lessons add to the bill. Continue reading

Get the latest news, articles and expert advice delivered to your inbox. It's FREE.
Earn 5% cash back at different places each quarter like gas stations, grocery stores, restaurants, and more up to the quarterly maximum, each time you activate.
For Excellent, Good Credit
INTRO OFFER: Discover will match ALL the Miles you've earned at the end of your first year, automatically. For example, if you earn 30,000 Miles, you get 60,000 Miles. That's $600 towards travel!
For Excellent, Good Credit
Earn unlimited 1.5% cash back on every purchase, every day
For Average, Fair, Limited Credit
You've successfully subscribed!

Please specify the following:All these fields are optional

Your Credit History
Themes you are interested in:

By providing this information you help us make our news letters more useful and informative. Thank you!