Consumer Finance

2016 US Credit Card Debt Topped $1T

Credit card receivables, otherwise known as outstanding debt, surpassed $1 trillion in the U.S. at the end of 2016, according to a new report from The Nilson Report, the credit card and mobile payment trade publication.

In a press release, Nilson said the outstanding debt was tied to Visa, Mastercard, American Express and Discover cards, as well as private-label cards in the retail, gasoline, medical, airline and car rental categories. “Every credit card purchase of goods or services immediately triggers outstanding debt,” said David Robertson, publisher of The Nilson Report, in a press release. “Every purchase is technically a loan. However, it is important to remember that more than one-third of all outstanding credit card debt at the end of each month will be paid in full before the buyer incurs any finance charges.”

According to The Nilson Report, 86 percent of the $1 trillion in credit card outstanding debt was generated by Visa, Mastercard, American Express and Discover cards, including receivables tied to commercial card products that are provided by corporations to their employees. The remaining 14 percent was divided among multiple private-label credit card providers. “In comparison, at year-end 2016, student loan debt totaled $1.407 trillion,” Robertson said. “Of the $1 trillion in card debt identified by The Nilson Report, only $650 billion was subject to finance charges, while the full $1.407 trillion in student loan debt was subject to finance charges.”

In terms of the number of American consumers with credit card debt, The Nilson Report found 157 million had outstanding debt on one or more cards at the end of last year, while student loan debt holders stood at 44 million, even though the total student loan debt stands at around $1.3 trillion. Nearly four times as many Americans have credit card debt than student loan debt, The Nilson Report noted.



Digital transformation has been forcefully accelerated, but how does that agility translate into the fight against COVID-era attacks and sophisticated identity threats? As millions embrace online everything, preserving digital trust now falls mostly on banks and FIs. Now, advances in identity data and using different weights on the payment mix afford new opportunities to arm organizations and their customers against cyberthreats. From the latest in machine learning for fraud and risk, to corporate treasury teams working in new ways with new datasets, learn from experts how digital identity, together with advances like real-time payments, combine to engender trust and enrich relationships.

Click to comment