The number of credit card accounts opened in the second quarter of 2013 increased 21% from the same time last year, largely driven by consumers with prime and near-prime credit scores.
And while those consumers are accepting more credit card offers, the data also shows early-stage bankcard delinquencies hit record lows, accounting for 0.9% of balances for the quarter.
“Equally important is that prime and near-prime bankcard utilization rates are not as high as they were a year ago,” said Linda Haran, senior director of product management and strategy for Experian Decision Analytics, in a news release about the analysis. “This is a positive trend, because it shows that despite an increase in new bankcard users, consumers are managing their credit wisely.”
The increase amounted to about $69 billion in new credit limits, up $12 billion from the second quarter of 2012. Bankcard originations were much higher in 2007 and 2008, but the product has grown steadily from post-recession lows in 2009.
What This Means for You
“The growth that we’ve seen for the bankcard expansion has started to see some acceleration over the last 18 months,” Haran said. “That lends itself to being an encouraging sign that lenders are back at the table to grow much more aggressively in the bankcard market.”
The surge in approving prime and near-prime credit card applicants supports that observation. New prime credit limits increased $6.9 billion from the second quarter of 2012, and nonprime limits are up $4.9 billion. Overall risk exposure is down $3 billion from the first quarter of this year.
With the market expanding, consumers may want to explore cards that may help them strengthen their credit scores. Before shopping around, get a picture of your credit rating — you can use the free Credit Report Card to see your credit score and an overview of your credit report — to see if smart use of a credit card will help you build credit. The tool can also match you to credit cards you’re most likely to be approved for.
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