Recent reports indicating a pullback in credit card approvals by U.S. banks contradict official data showing an increase amid changes in lending standards.
Increased Credit Card Approvals
Contrary to claims of a 5% drop in approvals during the Trump administration, data shows an increase in application volumes. Major banks like JPMorgan Chase and American Express continue to issue credit cards at higher rates, maintaining robust application volumes. As Jamie Dimon, CEO of JPMorgan Chase, stated, 'We are witnessing record-high application volumes and a robust demand for credit cards as we enter 2025.'
Rising Delinquency Rates Amid Economic Volatility
While delinquency rates are increasing, this has not led to a significant reduction in new card issuance. Banks continue to approve more applications, keeping consumer access to revolving credit. The growing delinquency trend, particularly among high-income areas, raises concerns, yet no direct links to the crypto market have been observed.
Comparison with Previous Crises
Historically, banks have tightened credit during crises such as those in 2008 and 2020. Current trends indicate banks are maintaining stability in credit card issuance, distinguishing the present situation from previous crises. Experts emphasize the need for ongoing monitoring of economic conditions. As William Dudley, former President of the Federal Reserve Bank of New York, mentioned, 'While credit card delinquency rates are rising, we do not see a corresponding drop in approvals which remains strong across major issuers.'
Thus, despite economic instability and rising delinquency rates, U.S. banks continue to actively approve credit card applications, reflecting their confidence in consumer demand.
