According to a new study from Equifax, credit card credit lines are rising higher and higher as consumers use less and less of their available credit. This year, American credit card accounts have topped 300 million - indicating that consumers are opening new lines but may not be using them to their fullest extent. The number of credit cards outstanding is at a 28-month high.
The study, known as the Consumer Trends Report, finds that Americans are using only 22 percent of their available credit on average. While the credit card industry has not found it difficult to get people to open new credit card accounts, credit card companies are finding that Americans have an aversion to rising credit card debts. Americans have slowly repaid their balances to multi-year lows. Credit card balances as a percentage of credit limits outstanding fell through May of 2012, ultimately reaching a five-year low.
In 2012, the amount of all available credit lines of newly issued cards amounted to a whopping $87 billion. This is roughly equal to one-fourth of total credit card debt outstanding as of the latest report from the Federal Reserve Bank. As credit card companies find that consumers are less than eager to use their cards, they are courting heavier spenders with higher credit lines, hoping to replace customers who have paid off and ignored their credit cards. Debit cards continue to be the most popular choice for spenders.
Across the nation, banks are more lenient with new credit card issuance. Banks originated $87 billion in new credit cards against a low of $55.5 billion in 2010, when the economy was only beginning to recover from one of the greatest recessions in American history.