TransUnion 2025 Consumer Credit Forecast Points to Moderating Credit Card Balance Growth and Slower Delinquency Gains

Core Insights - TransUnion projects a slowdown in growth for credit card balances and delinquencies by the end of 2025 after four years of increases [1][3][5] Credit Card Market Overview - As of Q3 2024, there are 554.5 million active credit cards in the U.S., an increase of over 100 million from 451.6 million in Q3 2020 [2] - Credit card balances are expected to reach $1.09 trillion by the end of 2024, with a year-over-year increase of 3.9%, and $1.1 trillion by the end of 2025, with a 4.4% increase [3][5] Delinquency Trends - Serious credit card delinquency rates (90+ days past due) are projected to rise to 2.76% in 2025, marking the fifth consecutive year of increases, but at a slower rate compared to previous years [5][6] - Delinquency rates among non-prime credit card borrowers are expected to grow at a slower rate, with a forecasted increase of 4% in 2024 and 8% in 2025, down from 39% and 21% in 2022 and 2023 respectively [4] Economic Context - The growth in credit card balances is anticipated to be driven by gradual price increases and consumer spending, alongside slower personal savings growth [6] - A recent study indicates that 63% of consumers feel their household finances are as planned or better, up from 60% the previous year, suggesting increased consumer confidence [7] Other Credit Products - Delinquencies in auto loans are expected to stabilize in Q4 2024 and decline in Q4 2025, while unsecured personal loan delinquencies are forecasted to remain relatively flat [9][10] - Mortgage delinquency rates are projected to remain low and flat in Q4 2025, despite slight increases in previous years [10]