Credit card monthly purchase volumes rebounded strongly in the third quarter of 2020, jumping more than 20% from the prior quarter despite challenges from the pandemic-induced recession, according to ABA’s latest Credit Card Market Monitor released today.
The share of account holders who paid their balance in full each month rose 1.5 percentage points to a record high of 33.7%, while the share of account holders carrying a monthly balance declined 1.7 percentage points to 40.7%, a record low. “Though many people are still unemployed, a combination of restrained spending and continued government support has left many consumers well-positioned to manage credit card payments,” said ABA Senior Economist Rob Strand.
The total number of accounts declined year-over-year for the second consecutive quarter, mostly driven by an 8.2% decline in subprime accounts. The total number of super prime accounts rose 1%. The total number of new accounts (those opened in the previous 24 months) fell 8.4% in the third quarter, the largest quarterly drop in a decade.