From a 2019 peak of $926 billion, credit card debt fell to $811 billion by the second quarter of 2020 — the largest six-month decline on record — before reaching $825 billion by the end of the year, according to a new CFPB report.
The CFPB on Wednesday released the report to Congress on the consumer credit card market, finding that the market’s growth over the past few years reversed course in 2020. In reviewing the market for potential consumer harm, the CFPB report presents research on consumer card use, cost and availability in the report.
During the pandemic, many cardholders received direct federal assistance, enhanced unemployment benefits and payment and interest suspension of federally held student loans, the report notes. Along with those efforts, credit card issuers also provided relief to cardholders through payment deferrals and fee waivers.
The report also notes the continued importance of issuers improving customer service and system reliability related to those relief programs and ensuring that their systems operate in full compliance with applicable law, even as the market continues to change with evolving economic conditions as well as with innovation in the card market and in competing product markets.
“While public and private programs helped consumers bring down their credit card debt during the pandemic, we at the CFPB will be watching to make sure families and individuals still struggling get the assistance they need,” said Dave Uejio, acting CFPB director. “Across the credit card market, consumers sought and used less credit, paid down debt, and dropped late payment rates to historic lows. As pandemic relief efforts end, the CFPB will be using all our tools to support an equitable recovery.”