Credit Cards Trends And Predictions by Market Expert
Explore the latest credit cards trends and predictions for credit cards in 2024 with our market expert’s guide. Stay informed about new features, benefits, and future credit cards trends.
While no one can predict the future, it is feasible to look at industry patterns and make educated assumptions about what credit cardholders might face in 2024. When it comes to future credit card projections, there’s a mix of good and bad news.
On a good side, there are indications that credit card interest rates may finally begin to fall this year. The bad news is that credit card debt and delinquencies have been increasing, and credit card fees may continue to rise.
Signs also suggest that card issuers may continue to reduce certain travel rewards incentives in order to balance the cost (and demand) of delivering these benefits with the appeal they bring to new and existing cardholders. Here are some of the most important credit cards trends to watch for in 2024.
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- High approval rates
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- Credit monitoring
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- TransUnion® credit report and score
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- Provide tax advice
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Credit Cards Trends & Predictions
Rising Credit Card Debt
According to Federal Reserve data, 2023 has been a challenging year for credit cardholders. Throughout the year, credit card debt reached new heights. Total credit card balances increased by $48 billion to $1.08 trillion in the third quarter of 2023, a record high.
Late credit card payments have also been on the rise. According to the Federal Reserve, 5.78% of cardholders were substantially delinquent on their credit cards (90 days or more past due). This is more than two percentage points more than the major delinquency rate of 3.69% in the third quarter of 2022.
According to TransUnion, the average credit cardholder owes $6,088 in Q3 2023, up 11% year on year. And, given these data do not account for holiday expenditures, typical credit card debt levels are expected to be substantially higher now.
Related: Best credit card to pay bills and earn rewards
Falling interest rates
High interest rates have made credit card debt more expensive than ever for customers who carry a balance. While the average credit card interest rate was 18.43% in Q3 2022 (on accounts with assessed interest), Federal Reserve data reveal that it had climbed to 22.77% by Q3 2023.
These modifications were mostly influenced by the Federal Open Market Committee’s (FOMC) 11 consecutive decisions to raise the federal funds rate in an effort to control inflation between 2023 and 2023. While the Federal Reserve does not directly set credit card interest rates, card issuers’ prime rates tend to rise or fall in reaction to the federal funds target rate.
Inflation has begun to fall, but it has yet to return to the Federal Reserve’s 2% target. As a result, the federal funds rate has remained unchanged throughout the last three FOMC sessions. Credit cardholders may expect variable credit card interest rates to remain stable.
Even better, Federal Reserve officials have stated that interest rate cuts are anticipated in 2024. If the federal funds rate falls in 2024, credit card interest rates may also fall, providing relief to customers who are in debt.
Of course, when (and by how much) APRs will eventually fall is unknown. That’s why, if you have revolving credit card debt, your best bet is to start paying it off right away. The most effective strategy to handle a credit card is to pay the full statement balance by the due date each month to avoid interest charges.
Continued competition from Pay Later and No Credit Check Products
The popularity of Buy Now, Pay Later (BNPL) finance does not appear to be declining anytime soon. BNPL loans are a relatively new technique for consumers to spread out their payments on major purchases, dividing those transactions into equal installments over a defined period of time. Consider this form of financing to be a modern-day layaway arrangement.
Some merchants collaborate with third-party vendors to deliver BNPL services to their clients. Credit card companies now provide their own versions of BNPL financing, which allows cardholders to repay larger purchases in equal monthly installments for a set monthly cost rather than a revolving interest rate.
One of the most appealing aspects of classic pay later options is that they rarely involve credit checks. If you have bad credit, you may have an easier time qualifying for this form of short-term borrowing. However, BNPL plans are unlikely to include standard credit card perks such as credit score building, fraud protection, or rewards. It is crucial to analyze the advantages and disadvantages of these financing options and have a thorough knowledge.
Related: Prosper Card Review: Card with no Security Deposit
Credit Repair
01
Credit Repair
02
4.5
Credit Repair
03
Credit Repair
04
Credit Repair
05
Credit Repair
06
Credit Repair
07
Credit Repair
08
5
Average Review
Credit Repair
- Certified pre-approval Process
- Online Application Available 24/7
- Find a Quote Easily
4.5
Average Review
Credit Repair
- Certified pre-approval Process
- Online Application Available 24/7
- Find a Quote Easily
- 100% Online Refinance
4
Average Review
Credit Repair
- High approval rates
- Financial guidance
- Unlimited access to credit options
5
Average Review
Credit Repair
- Credit monitoring
- Personalized credit tips
- TransUnion® credit report and score
5
Average Review
Credit Repair
- Provide tax advice
- Debt relief services
- Credit repair services
