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Credit card delinquencies, card over limit up significantly in 2022

Almost half of consumers used credit cards for holiday spending.

Credit cards played a big role in holiday shopping.

Forty-seven percent of respondents used credit cards to fund their holiday spending, and one in five respondents intend to pay off their bills with federal tax refunds, according to a post-holiday spending survey by ScoreSense, a credit monitoring product.

Overall, 53% of participants mentioned that 2022 holiday spending "somewhat" or "extremely" added to current debt, and 37% of the respondents are concerned about paying off their holiday bills.

The survey found that delinquencies increased by 24% from 2021 to 2022, and care over limit increased by 19% in 2022 compared to 2021. And new Inquiries dropped by 18% in 2022 compared to 2021.

Additional findings from ScoreSense report are below:

The survey by ScoreSense also revealed:

  • Respondents between the ages of 25-34 were more likely to use a credit card or Buy Now, Pay Later financing to fund their holiday spending.

On the other hand, 41% used cash, the majority of whom are over the age of 54.

  • One in four consumers will pay off their credit card immediately while one in five are planning to use their tax refund to help pay their holiday bills.
  • Overall, 53% of participants mentioned that 2022 holiday spending somewhat or extremely added to current debt. This was very noticeable for those between the ages of 25-44 (60%).
  • With an increase in debt, 37% of participants are worried or somewhat worried about paying off their holiday bills.
  • Nearly 56% of participants went slightly or way over budget for their holiday spending in 2022. Those over the age of 54 were more likely to stay within budget compared to other age groups.
  • 44% of participants said they spent more in 2022 than in 2021. Those aged 25-34 (54%) claimed they spent more in 2022 than in 2021 compared to other age groups.
  • 50% of participants mentioned they spent more on food and beverages as well as gifts for family in 2022 than in 2021.

"In a typical year, we see late payments on credit cards after heavy holiday spending, but this year is different because many consumers have been relying on credit cards to pay for routine household bills and services," said Carlos Medina, senior VP at One Technologies, which offers ScoreSense. "Also concerning is that many consumers expect and rely on tax refunds to pay off holiday bills, and refunds for a lot of people this year are projected to be much smaller.”

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