That is the finding of a new report by TransUnion, which indicated that the total amount of consumer debt held on bank-issued cards in the third quarter rose by 6 percent compared with the same period last year.
Meanwhile, the study also shows that delinquency is growing more common. Compared with one year ago, the delinquency rate on this type of credit card debt has gone up by 5.8 percent.
To financial experts, this trend did not come as a surprise, given other economic trends such as mounting job losses that may cause people to skip payments on their credit card debt.
“As expected, bankcard delinquency is again on the rise after experiencing two consecutive quarters of decline,” commented Ezra Becker of TransUnion.
Even though debt may be rising, this may be due to people using their credit card for necessary purchases, rather than luxuries.
In fact, a separate report from Discover Card found that 55 percent of this year’s holiday shoppers plan to cut back on their spending.
People’s estimates for how much they will spend are 10 percent lower than they were last year, according to the figures.
If you are planning to use a credit card to fund your holiday purchases, keep an eye on your interest rate to make sure your provider is not increasing it – a common practice that has been noted in recent months.
Consumer advocate Gerri Detweiler told CBS that “credit card issues are raising interest rates on customer who have never been late on a single bill – and these interest rates are sometimes 22, 29 and even 36 percent.”
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