Revolving credit, which is primarily from credit cards, fell for the 17th consecutive month in February, declining at an annual rate of 13%. The $858.1 billion in revolving credit represents a $100 billion decrease since the fourth quarter of 2008.
Recent studies underscore some trends in credit card usage.
- The number of new credit cards issued declined 45% last year, according to Equifax Consumer Credit Trends.
- The average balance on Visa
, MasterCard and American Express accounts dropped 5% to $5,434 in the fourth quarter from $5,729 a year earlier.
- According to a BIGresearch survey in January, 31% of respondents said they pay with cash more often, up from 23% a year earlier. The same study showed that 38% of consumers plan to pay down debt during the next three months, up from 34.4% in December.
- Issuers will reduce credit card lines by $2.1 trillion during the next 18 months, wiping out nearly 45% of the spending power U.S. consumers have on credit cards, predicts investment bank Oppenheimer.
—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.