Paper and Plastic

The holiday season saw consumers shift away from credit card spending. What does that mean for credit unions?


During the recession, consumers were forced to make difficult decisions driven by short-term needs rather than long-term prudence. And no one faults the calls as times have been exceedingly tough. Now, as the economy begins to loosen a bit, it looks like Americans are thinking beyond the immediate future.

An ABCNEWS article from earlier this month offers figures from a TransUnion report indicating that consumers are steering clear of credit card spending when possible. The article (and the report) provides some intriguing statistics.

  • 8 million: The number of consumers that have stopped using credit card since 3Q2009
  • 78 million: The number of consumers that don’t have access to or do not use a credit card
  • $4,964: The average credit card debt in America as of 3Q2010
  • $5,612: The average credit card debt in America as of 3Q2009
  • 11%: The percent decrease from the average credit card debt at this time last year

What does the decline mean for credit unions? First, it means that the credit card portfolio moving into 2011 might need to be recalibrated. Think of questions such as:

  • What kinds of credit cards do you offer? What are the attractive or unattractive attributes of each?
  • Which sections of your membership are using credit cards?
  • How are your marketing the cards?

The New Year is about taking stock. In light of these figures, examining the role of credit cards in your lending portfolio could be beneficial.


Dec. 29, 2010



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