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Credit Card Debt Hits New Record High, Delinquencies Remain Elevated
February 11, 2025
America’s collective credit card bill has grown to a record high of $1.21 trillion, according to a new quarterly report on household debt from the Federal Reserve Bank of New York.
Credit card balances jumped $45 billion during the period between October and December, driven in part by holiday spending. Credit card debt is now 7.3% higher than it was a year ago.
The report also found that credit card delinquency rates have “remained elevated,” even ticking up slightly in the fourth quarter, which Fed researchers note could be an indication that “borrowers are having some difficulty repaying.” Last year, 7.18% of credit card balances transitioned to delinquency, meaning payments were at least 30 days past due. The rate of serious delinquency, meaning more than 90 days past due, also ticked up last quarter.
Credit Card debt has largely remained stable over the past two decades. However, in the years since the pandemic, American households have spent down the excess savings they amassed during the pandemic, and consumers are increasingly relying on credit card debt to maintain spending in the face of higher inflation.
At the same time, credit cards have become one of the most expensive forms of borrowing. After a series of interest rate hikes from the Federal Reserve, the average credit card interest rate has risen to more than 20%, near an all-time high.
