I've had a lot of success when it comes to providing the right information to help people find the best credit card for their needs.
Over the years, I've noticed the single most important factor for making the right credit card choice is having the right information.
That's why my team and I spend a lot of our time and energy collecting the most up-to-date statistics and relevant news and information about credit cards.
We aim to provide high quality information you might need to help you decide which cards are right for you.
Recently we collected and analyzed data from 1,674 different kinds of credit cards—with this many cards out there, you certainly have a lot of options and also a lot of factors to consider.
In our research we discovered the impact credit cards have on the overall economy and on the lives of the people who use them.
This is why finding the card that best suits your lifestyle and your specific needs can help you live the life you want.
So if you're in the process of choosing and applying for a credit card, you need to understand the pros and cons of having one, so you can make an educated decision.
And that's where we can help!
I'm going to share the statistics we've gathered to illustrate how credit cards are influencing today's economy and how they're impacting people's lives.
You'll come away not just with the knowledge of how credit cards can positively impact your own life, but also with vital tips on what to do to avoid negative credit card experiences.
Choosing the best credit card for your needs from a field of 1,600+ options may sound daunting.
But with the statistics we've collected and the knowledge we're about to share with you, your choice will be much easier, and you'll be able to zero-in on the best credit card option for you.
Average American Credit Card Debt
The average credit card debt of an American household is $15,675
It's been a decade since the economic crisis of 2008.
Over the last 10 years, the steady recovery of the American economy has been mirrored by the steady increase in the average level of credit card debt.
More debt among fewer people. One surprising finding our research revealed was the average percentage of people with credit card debt actually decreased over the same period.
38.1% of all households are carrying credit card debt today.
In the year 2000, over 50% of all American households had credit card debt.
Which means although fewer people are becoming more heavily indebted, the average person who has debt is carrying more than before.
Don't use all your credit. One tip to take away from these stats is to make sure you don't max out all your available credit.
Just because you have a credit card limit of $5,000 doesn't mean you should use it all.
The less of your available credit balance you use, the better your credit score will be.
And you won't become another high-debt statistic.
Largest Credit Card Issuers
Citibank holds the largest share of America's credit card debt
The big banks are the winners. The trend in the stats toward increased credit card debt signals growing profits among the biggest credit card issuers.
By far the biggest credit card issuers in the U.S. are the banks.
Three banks have 40% of the entire market. The bank with the biggest market share is Citibank, with 18% of the total market and $144 billion in credit card loans to American customers.
J.P. Morgan Chase is next with $124 billion in credit card loans, followed by Capital One, with $91 billion in outstanding loans.
Market share isn't the only relevant stat. Another statistic we looked at was the rate the banks grew their credit card client base.
Smaller Top 10 banks are getting more new accounts. Wells Fargo, Barclays, and U.S. Bank (three other banks in the U.S. top 10) saw a combined 66% increase in new accounts opened over the last five years.
Compared to the 3% growth in new accounts reported by the top three, the 66% increase among these three smaller banks is certainly impressive.
One reason these banks are getting more new accounts at such a rapid pace is because issuers are more willing these days to accept customers with lower credit scores.
Another reason is the popularity of co-branding partnerships with retailers, where store-specific cards offer the user rewards points or cash back.
Choose a smaller bank if you're having trouble getting approved. For people with lower credit scores, one tip from this data is to choose a card from one of the smaller banks.
You'll have a better chance of approval (albeit with a low credit limit), which is why so many people have new accounts with these smaller credit card issuers.
62.5% of credit card applicants are either outright rejected or denied
A 2017 Federal Reserve survey found 43.6% of all respondents had applied for credit in the previous year.
Thumbs-down almost two-thirds of the time. Of the people who said they applied for credit, 24.8% were rejected, and 37.7% had their applications denied.
Fill out the paperwork properly. Some of the rejections could be simply due to the applicant not filling out the application properly, or they were not old enough to get a card.
You need to show them you're earning. Unsuccessful applications could also be due to a lack of personal income, no previous credit history, or a limited job record.
It's not you, it's your credit score. By far the biggest barrier to a successful credit card application is a person's low credit score and the many factors used to compute it.
Credit scores are calculated based on your current and past credit behaviors, and any red flag will cause your score to go down, making it hard to get credit.
High balances hurt your score. If you are maxing out your credit cards or have a loan with a high amount remaining to be repaid, your score will more than likely take a hit.
Too many credit cards or credit inquiries looks bad. If you already have multiple credit cards, or if you've applied for a bunch recently, a dip in your credit score will show it.
Poor credit behavior doesn't go unnoticed. When you miss or make late payments or have an account go into delinquency or collections, your credit score will take a hit and it will be harder to get another credit card.
Avoid rejection by improving your credit score. There are a few things a person can do if their credit card applications are being rejected due to a low credit score.
First, they can apply for a credit card that accepts people with poor credit.
The trade-off is there will be a super-high interest rate (APR) charged on unpaid balances, and the credit limit will be very low.
For example, if a person with a "Bad" credit score (560–650) gets approved for a credit card, their credit limit might only be $300, and the APR charged will be 30% or more.
Second, they can apply for a secured credit card, which means they put down a deposit, so the bank won't lose money if they can't pay it back.
A secured card is a great way to steadily build up your credit score from scratch.
In case you need to improve that credit score of yours to qualify to get your deposit back sooner, taking out a small personal loan just might help.
Use the card to repair your score. With either option, using the card properly can help a person rebuild their credit rating.
The best tip is to use the card while keeping the balance low and to always pay your monthly balance off in full and on time.
Online Credit Card Use
Consumers prefer shopping online with credit cards as opposed to PayPal or debit
More and more consumers are choosing to make their purchases online rather than through traditional brick-and-mortar stores.
Online shoppers like put it on plastic. According to statistics, 42% of online transactions were paid for using a credit card.
PayPal isn't far behind. In second place is PayPal, with 39% of transactions.
Debit cards trail behind. With just 28% of online transactions, debit cards are the least preferred form of paying on the internet.
The perception of safety is key. 42% of consumers think credit cards are the safest method of buying online, followed by 26% in favor of PayPal.
Only 12% felt debit transactions were the safest.
Use PayPal and your credit card together. One great tip is to link your credit card to your PayPal account and choose it as your account's preferred payment method.
You can enjoy the convenience and security of paying online through PayPal and you'll still be paying with your credit card (and earning any rewards or cash back).
High Credit Scores
The number of consumers with a credit score in the super-prime range of 800 or above is more than it has ever been
The average FICO score is higher than it's ever been, reaching over 700 for the first time in 2017.
The cream of the credit crop. People with FICO credit scores of 800 or higher are viewed as "Exceptional."
Over 20% of Americans today have a FICO score higher than 800, which is the highest percentage in history.
Raise your score to save money. Having a high credit score is more than just a report on your good behavior—it can actually save you a lot of money in the long run.
The higher your score, the lower the APR you'll be offered, meaning you'll be paying less on interest on almost everything.
If you have an 800+ FICO score, you are given the lowest interest rates on loans, mortgages and credit cards, which can save you thousands of dollars over time.
Credit Gender Differences
Women are slightly more likely to be charged penalty fees than men
When it comes to credit, our findings suggest women and men have different behaviors.
60.3% of women have reported paying a late or over-limit penalty fee in the last year.
57.4% of men say they've been penalized for late payments or going over their limit.
At the same time, women were found to have 23.5% more open credit cards compared to men but carried 3.7% less total debt.
Sign up for payment alerts. To avoid late payments, one great tip is to use your credit card provider's online banking facility.
Choose to receive regular email notifications a few days ahead of your payment due date and pay your credit card bill online for more convenience.
Credit Cards and Savings
Families without credit card debt reported having savings three times greater than households with credit card debt
Low- to moderate-income Americans are far less likely to have a credit card than families who are middle- to upper-income.
A whopping 94% of middle/upper-income families have a credit card, while only 59% of those with lower incomes report having a card.
Among families with credit cards, those carrying debt were found to be three times less likely to have any savings.
50-30-20 will help you save. Every family should have some savings, even if it's just an emergency fund.
One budgeting tip for saving money is to budget 50% of your income for basic living expenses (rent, groceries, etc.), 30% for entertainment and leisure, and 20% on savings and debt.
Total Credit Card Debt
The total credit card debt owed by Americans is more than a trillion dollars
According to the Federal Reserve, in 2017 the total credit card debt in the U.S. was $1.0004 trillion, which represented a 6.2% increase from the previous year.
High debt means high interest. The average household with revolving credit card debt pays $904 in interest every year.
There are good and bad reasons for growing debt. One of the more alarming reasons for the growing credit card debt among Americans is unpaid medical expenses.
Up to 27 million U.S. adults are paying for their medical bills through high-interest credit card loans.
Rewards cards are hugely popular. There's also been a huge growing trend toward rewards or cash back credit cards, which has increased credit card spending but unfortunately, also increased the average American's debt.
Choose a no annual fee rewards card. A great way to use a cash back credit card without taking on more debt is to find a card with no annual fee.
Citi has a few cards charging no annual fee, like the Citi Double Cash card, which also doubles all the cash back you've earned when you pay it off—an incentive also to pay your balance in full and stay debt-free.
Generation X and Baby Boomers have the most credit card debt
As people get older, their credit card debt typically increases steadily until it reaches a peak somewhere between ages 35 and 54, then it starts to decline.
Income can't keep up with expenses. As families grow and their expenses increase, there is a tendency to take on more debt.
There's also the issue of costs rising faster than incomes.
Medical costs have increased 34% in the past decade, and food prices are up 22%, but income growth has hovered around 20%.
Generation X-ers lost the most during the 2007–2008 financial meltdown and their debt levels reflect it.
Gen X (people aged 35–49) have the most non-mortgage debt with an average of $30,334.
Baby Boomers (aged 50–70) are next with $27,531 average debt.
Consolidate balances to become debt-free. For many of these indebted Americans, getting out of debt (without declaring bankruptcy) is very much possible.
If juggling multiple debts on high-interest credit cards is part of the problem, consider consolidating them all into one account to make the process of paying them off a lot more convenient.
Get a balance transfer credit card. Apply for a new card with a 0% balance transfer fee and 0% purchase interest rate intro offer.
Transfer your high-interest debts and pay the combined balance off before the zero-interest period expires (the introductory offers are usually 12–21 months long).
For example, the Chase Slate card offers 0% APR on purchases and balance transfers for 15 months (and there is no fee for balance transfers done within the first 60 days).
Credit Cards as Payment Method
40% of people prefer to use a credit card for purchases
According to the 2016 Consumer Payment Study by TSYS, 40% of Americans use credit cards as their preferred choice for making payments.
Debit cards are preferred by 35%, and cash is used primarily by only 11%.
The reason for this is due to the convenience of being able to pay with a card and without having to carry cash.
It's also handy to be able to make purchases today and pay for them later (and to have access to credit if you need to borrow for important purchases).
Get rewarded for your spending. People are also using credit cards for payment so they can earn travel rewards or cash back from their expenses.
Cards like the Chase Sapphire Preferred card let you earn double points for travel and dining expenses.
There's also a huge 50,000-point intro offer for signing up and spending $4,000 on the card within the first 3 months.
Percentage of People with Credit Cards
77% of Americans have at least one credit card account
Over three-quarters of the American population have a credit card in their wallet.
Among those credit cardholders, the average number of cards they own is 3.4.
Use your credit cards strategically. With over 1,600 different credit cards available to the American consumer, it's possible to use multiple cards for different purposes.
For example, if you are a frequent flier you could book all your travel using a travel rewards card where you can earn points you can use toward hotel and airline purchases.
When it's time to fill up the tank or stock the fridge, you could pull out a cash back card with high earning rates for gas and groceries.
Balances and Minimum Payments
58% of Americans carry a balance and 40% always pay more than the monthly minimum
42% of people pay their credit card balances in full every month.
That means the rest (58%) are carrying a balance into the next month.
Of those, less than half (40%) say they pay more than the minimum amount required to avoid late payment penalties.
Look for a low APR credit card. Of course, the best tip is to pay off your statement balance in full every month so you can avoid paying interest (things are expensive enough already!).
Since always paying in full isn't a reality for many people, it's important to look for a card with the lowest possible APR.
As a benchmark, a low APR credit card could offer an interest rate of a little over 11% for people with excellent credit.
Credit Card Fraud
46% of Americans have fallen victim to credit card fraud in the past five years
Nearly half of all Americans have experienced the all-too-familiar situation where unknown expenses show up on their credit card bill.
With data breaches happening all the time, some fraudsters are finding it easier and easier to access people's credit card information.
Be vigilant with your credit card security. Chip technology and fraud protection are important factors to consider when you're choosing a credit card.
You should also follow safety protocols like immediately reporting lost or stolen cards and changing your password or PIN on a regular basis to avoid fraudulent transactions.
Millennial Credit Card Use
67% of Millennials don't have credit cards
More than two-thirds of the Millennial Generation (aged 21-34) are choosing to go without a credit card.
Many have also put off purchasing homes so they can build wealth.
Think down-stream. Avoiding debt is great, but—by forgoing the use of credit cards—these younger adults are missing out on opportunities to build their credit score.
When the time comes for them to access credit, their credit histories won't help them much when it comes to availing of the best interest rates.
Rather than avoiding credit cards entirely, the best solution is to get one and use it responsibly and sparingly to gradually build up their credit scores.
Credit Card Data
The data shows a healthy and thriving credit card industry
After looking at the data from 1,674 credit cards, it's pretty clear that the credit card industry today is thriving.
The top five credit card issuers share a total of 722 million active accounts in the U.S.
Visa leads the pack. With 323 million active cards and a net income of $6.69 billion in 2017, Visa continues to be the credit card juggernaut.
Mastercard comes in second. There are 191 million Mastercards in circulation today.
That's a lot fewer than Visa's, but with a net income of $3.9 billion in 2017, being in second place doesn't seem so bad.
Chase is #1 in the U.S. As the top issuer of credit cards in America, and a market share of over 30% in this country, Chase is a dominant player in the U.S. credit card industry.
The company has 93 million cards in circulation, ranking it third overall.
American Express caters to high-income users. Although there are only 58 million American Express cards in circulation, Amex cardholders are the most active user base of all—boasting the highest number of transactions among all credit cards.
You need at least a "Good" (623 or higher) credit score to get approved for an Amex card, so it makes sense why most of their cardholders are in a healthy financial condition and able to spend a lot.
The Discover Card is a leader for cash rewards. The Discover Card has been chosen over 57 million times, and the main reason is its awesome cash back program.
Its Cashback Match feature lets you earn up to 5% cash back on some purchases, then it's doubled at the end of the first year.
U.S. banks are showing steady growth
Citi is the world's largest credit card-issuing bank, with more than 142 million accounts and $499 billion in purchase spending in 2017.
JP Morgan (aka Chase) reported a 22.4% credit card sales market share in 2017, rising from 15.9% just over a decade ago.
In 2017, Bank of America saw over $244 billion in purchases via the credit cards it issued in the United States.
With an increase of $13 billion from the previous year, BofA identified higher levels of consumer spending as the reason for its year-over-year growth.
In 2017, Wells Fargo reported a 6% increase in credit card balances from the previous year, with $37 billion in outstanding balances.
Knowledge is power when it comes to choosing a credit card
With 1,674 credit cards currently available, it's difficult to stay on top of all the important developments and trends in this thriving industry.
Moreover, it isn't easy to know how the card you choose will impact your life and financial situation in the long term.
But now that you're aware of all the factors you should take into account when deciding which one is right for you, you now have a much better chance of making the right choice and reaping the rewards later on.
Over my 18+ years of connecting people with the credit solutions I have discovered that may match their specific needs, I've seen time and time again how important it is, not just to have access to the right information, but to pay attention even to the small details.
Credit cards are an important part of modern society, and they enable cardholders to live their lives more fully and with more ease and convenience.
If you think having a credit card isn't really your thing, simply maintaining and sparingly using one can affect your financial life positively.
And even if you're already mired in credit card debt, you can still find ways to overcome your situation through the kind of help and guidance we provide here at CreditLoan.
Now that you hold knowledge of the key stats and inside info on the credit card industry and the major players involved, you can feel confident when you're making your choice.
Do you know any stats or trends we've missed in our analysis of the credit card market?
If so, please share them in the comments below!