A Rebounding U.S. Economy Means Greater Opportunities for Borrowing with Credit Cards

The U.S. credit card market has made a comeback alongside the momentum of the U.S. economy. Last quarter, credit card loans touched their highest level in over five years on strong job growth and improving income levels.

After mortgage and student loans, credit card debt is the third largest source of consumer borrowings. Overall, the number of new credit card accounts has now increased for over three years, while monthly credit card purchase volumes rose across all categories.

Average credit card purchases were up 6.6% year-over-year (YoY) in first-quarter of 2015, for the top seven general purpose card issuers, after a 6.7% rise in the fourth quarter of 2014. Credit card use, particularly with 30+ delinquencies, improved in the first quarter.

This growth comes from a parallel increase in consumer confidence, gross domestic income, real personal expenditures and non-residential fixed investment.

Credit card payments are developing into the most common source of customer payment. The convenience of using credit cards generally increases the likelihood of consumer “impulse purchases,” which ultimately contributes to an increase in the average sales of a business.

The use of credit cards, particularly in eCommerce, has gained popularity as it is convenient for both businesses and consumers to exchange money electronically over the Internet. User friendly online payment helps businesses receive and make payment virtually from any customer having an email account.

Credit cards loans will experience more growth as economic indicators continue to improve. The Consumers Sentiment Index reached a five-month high in June, indicating that the consumers are optimistic about the U.S. economy. Harsh weather conditions, a stronger dollar and heavy job losses led to miserable consumer loans in the first quarter of the year. Consumers were cautious about adding more debt, which led to a personal savings rate of 5.5% in 1Q15, up from 4.6% in 4Q15.

Total consumer credit has shown an uptrend in the last four months of 2015. It climbed $20.5 billion to a record high of $3.38 trillion in April, driven by an $8.6 billion increase in credit card borrowings, also known as revolving credit.

Consumer loans grew by $4.3 billion in March, the highest in the past eight months. On a year-over-year basis, consumer borrowings were up 6.6%, with credit cards rising 3.2 %, while auto and student loans were up by 7.9%.

If you are looking for $50,000 to $250,000 in zero-percent interest credit cards (that will not reflect on your personal credit), there has never been a better time to get started with Fund&Grow. Contact Fund&Grow today to learn how you can achieve this level of financing, with no up-front fees.