May 5, 2022

ABA: Report Finds Credit Card Market Recovery Continued in Fourth Quarter 2021

In a sign of continuing U.S. consumer strength, monthly credit card purchase volumes rose across risk tiers (prime, subprime, and super-prime) in last year’s fourth quarter, the third consecutive increase, according to the American Bankers Association’s latest quarterly Credit Card Market Monitor released today.

The May 2022 Monitor, which reflects credit card data from October to December 2021, reveals that monthly purchase volumes* rose 4–6% across risk tiers compared to the previous quarter. Purchase volumes were 23–27% above year-earlier levels, and although high inflation was partly responsible for the spending increase, inflation-adjusted monthly purchase volumes also rose across risk tiers on both a quarterly and annual basis. Meanwhile, the effective finance charge yield (which measures interest payments relative to total outstanding credit in the market) fell another nine basis points to 12.01%, a new four-year low. 

“The strong labor market allowed consumers to continue driving the economy forward,” said ABA Chief Economist and Head of Research Sayee Srinivasan. “While the U.S. economy is dealing with higher inflation and consequently rising interest rates, as evidenced by credit card debt as a share of disposable income, U.S. households’ balance sheets remain robust to help absorb shocks from these headwinds.”

Other metrics featured in the Credit Card Market Monitor suggest that consumer credit conditions continued to normalize in the last three months of 2021. For example: 

“While new account generation and initial credit lines fell during the first year of the pandemic, in response to improved economic conditions, credit card issuers are now extending more credit to consumers,” said Srinivasan. 

The full report with detailed charts and statistics is available here.

*Seasonally Adjusted

**New accounts are defined as those opened in the previous 24 months.

About the Credit Card Market Monitor

The American Bankers Association Credit Card Market Monitor is a quarterly report that provides key statistics on industry trends and relevant economic factors affecting the industry.  The credit card data used in the report is taken from a nationally representative sample provided by Verisk Financial | Argus.  Credit card data are presented as national averages for all accounts based on actual credit card account information.  No individual account holder’s information or specific financial institution’s data can be identified from the data set.  Other data used in the report are taken from various public and private sources, including the Department of Commerce’s Bureau of Economic Analysis and the Federal Reserve.

Answers to Frequently Asked Questions and definitions of the data presented in the ABA Credit Card Industry Monitor can be found in an Appendix attached to the monitor.

Results of this and all previous reports can be found at

This post was originally published here.