CFPB: Credit card availability grows with uptick in approvals

Most measures of credit card availability grew in 2021 and 2022 after a sharp decrease in access during 2020, the Consumer Financial Protection Bureau concluded in its biennial report to Congress on the credit card market, released today. The report also found that credit card debt at the end of 2022 grew to more than $1 trillion, but total outstandings remain below pre-pandemic levels when adjusted for inflation.

Nearly 4,000 issuers, together with dozens of co-brand merchant partners and four major networks, provide cards to over 190 million consumers, the CFPB said. The top ten credit card issuers represent more than four-fifths of consumer credit card loans, but the next 20 largest issuers’ market share has grown since 2016.

Application volume for general-purpose credit cards reached a new peak in 2022 as issuers increased acquisition efforts and consumer demand grew, the CFPB said. At the same time, application volume for retail cards fell from 2020 to 2022. Approval rates rebounded for all card types, with significant growth in credit card originations in both 2021 and 2022.

Credit card spending grew to $846 billion in the fourth quarter of 2022, according to the report. Delinquency and charge-off rates in 2022 were at lower levels than 2019 but increasing, possibly because of the expiration of COVID-19 related financial relief, the bureau added. The dollar value of rewards earned by general-purpose cardholders exceeded $40 billion for mass market issuers in 2022.

In a statement, the American Bankers Association said the report shows that an increasing number of Americans are turning to credit cards to conveniently and safely manage their purchases and bills. “It’s also important to note that as this report demonstrates the growing use and popularity of credit cards in this country, the CFPB is proposing regulatory changes that could limit access to credit cards and the many benefits they provide. Those changes will harm consumers the most,” the association said.