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Double Whammy

Inflation, high-interest rates, rising prices and unstable economy have pushed consumers to rely more on credit cards to keep up with their lifestyle in spite of rising rates. Even Get Z age consumers which research has long suggested that they resisted the use of credit cards have had their credit card balances rise at unprecedented levels. Buy Now Pay Later programs saw a huge adoption this past year, and we are now seeing tremendous growth in consumer unsecured personal loans for debt consolidation. Consumers are hurting, and looking for ways to bring down their overall interest burden. The only issue is that many consumers don’t change their spending habits and soon enough they run up their debt all over again.

It’s a double whammy for consumers and credit card, auto loans and personal loan delinquencies are on the rise, which begs the question, are we heading into a credit burst? Credit card issuers have already tightened their underwriting process for new applicants, and opening new accounts has become harder. As consumers navigate paying one debt with another, and inflation continues to plague their budgets, consumer spending has started to show some slowdown, but as the holidays approach, credit card spending will rise again. We will keep you informed with the latest industry news, consumer spending reports, and business tips right here. For business solutions, contact us today.

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