53% of Consumers Use Credit for Planned Purchases

A growing share of consumers in the United States are using credit not simply because they have to, but because they see it as a flexible financial tool that can serve different needs at different moments.

That was one of the central findings in the PYMNTS Intelligence report “Credit’s New Reality: Seven Numbers Reshaping the Card Economy,” which explored how consumers approach borrowing in an economy shaped by uncertainty and opportunity.

The research revealed that credit has evolved into something more nuanced than a simple borrowing instrument. Consumers increasingly treat it as a mix of planning tool, safety net and financial strategy.

For banks and card issuers, this shift exposes a deeper story about why people turn to credit in the first place and how those motivations are changing.

The report showed that credit serves two distinct roles in consumers’ financial lives. Many households use it deliberately for planned purchases, while others rely on it when unexpected expenses arise.

At the same time, a perception gap remains a barrier to wider credit use. Many consumers assume they would be denied credit products even when approval rates suggest otherwise. That psychological hurdle prevents some people from applying at all, even though credit can help them build financial resilience or improve their credit standing.

Several data points highlighted how consumers think about credit:

Many households treat credit as part of a deliberate financial strategy, as 53% of consumers who used credit in the last 90 days said those purchases were mostly or entirely planned.

The share of consumers who said they doubt they would be approved for a new credit card was 42%, nearly three times the actual denial rate among people without cards.

For consumers without an active credit card, 26% said their main reason for wanting one is to build or improve their credit score.

Taken together, the findings revealed that motivations for using credit extend beyond covering shortfalls. For many consumers, credit products are tied to long-term financial goals. Improving a credit score can open doors to better interest rates, housing opportunities and access to other financial products. That helps explain why the desire to strengthen a credit profile ranks among the most common reasons people consider new credit tools.

Generational differences also shape how and why credit is used. Young consumers are more likely to rely on credit for spontaneous spending. The report found that 22% of millennials use credit cards for unplanned purchases, the highest rate among age groups. Older consumers, by contrast, tend to approach credit more strategically. Many focus on maximizing rewards or selecting specific cards for different spending categories.

Financial stability plays a role as well. Households living paycheck to paycheck are far more likely to use credit reactively when unexpected costs arise. Consumers who are more financially secure tend to plan their credit use ahead of time, often tying it to rewards programs or cash flow management. In practice, most consumers fall somewhere between these two extremes. Many report using credit for both planned and unplanned spending.

According to the report, consumers increasingly value flexibility in credit products. Many express interest in cards that allow them to choose between earning rewards or receiving lower interest rates each month, adjust payment due dates to match pay cycles, or convert large purchases into installment payments. This demand reflects a broader shift toward customizable financial tools.

The research also pointed to an opportunity for banks and card issuers. Many consumers underestimate their chances of approval. Only about 15% of people without a credit card reported having been denied when applying for one. That gap between perception and reality suggests that clearer communication and more tailored products could bring more consumers into the credit ecosystem.

In the end, the report suggested that credit is no longer viewed solely as a last resort. For many consumers, it has become a financial instrument that supports planning, flexibility and long-term financial progress. In other words, credit is not just about borrowing. It is about strategy.

At PYMNTS Intelligence, we work with businesses to uncover insights that fuel intelligent, data-driven discussions on changing customer expectations, a more connected economy and the strategic shifts necessary to achieve outcomes. With rigorous research methodologies and unwavering commitment to objective quality, we offer trusted data to grow your business. As our partner, you’ll have access to our diverse team of PhDs, researchers, data analysts, number crunchers, subject matter veterans and editorial experts.