Credit Card Holders Better At Paying On Time

Credit card delinquency has reached an 11-year low, indicating credit card borrowers are increasingly worthy of their credit.


Credit unions welcomed sharp declines of 38 basis points in overall loan delinquency in the second quarter, including in credit card payments. And current economic indicators show that trend has been continuing into the third quarter.

Delinquency on credit cards issued by banks dropped to the lowest level since 2001, with only 2.93% of credit cards holders delinquent on their bills, according to the American Bankers Association. For credit unions, that rate was even lower as of the second quarter with only 0.91% of credit card holders delinquent, down from 1.19% in the second quarter of 2011.


Source: Callahan & Associates' Peer-to-Peer, 2Q2012

Credit card holders have been making significant strides in improving their payment promptness in recent quarters, proving that credit unions that are taking risks on issuing more credit cards aren't without cause. Credit unions that are working with members one-on-one to determine if they are qualified and that are taking chances on some members, can rest assured that consumers seem to really be trying to prove they are financially responsible.

The American Bankers report underscores the improving delinquency trend identified by the Federal Reserve Board this summer, which revealed that credit card delinquency, including credit cards issued by credit unions, reached the lowest level since 2008.