ARLINGTON, Va.—Total consumer credit grew 2.2% in September at a seasonally-adjusted, annualized rate and is up 3.5% compared to a year ago, according to new data from the Federal Reserve.
In addition, revolving credit – primarily credit cards – rose 2.9% and is up 9.9% compared to September 2022.
Non-revolving credit – primarily auto and education loans – rose 1.9% in September and is up 1.5% from a year ago, the data show.
“Consumer credit rebounded in September, but continues on a general downward trend,” said NAFCU Vice President of Research and Chief Economist Curt Long. “Non-revolving credit increased by only 1.9%, but that still represents a significant jump from the 9.8% drop in August. Revolving credit, on the other hand, slowed from a 13.7% gain in August to a modest 2.9% increase in September. While revolving and vehicle loans continue to advance, student loan balances are in retreat.”
Additional Data Points
The Fed data also show consumer credit for credit unions grew 0.4% in September. Banks experienced a 0.1% loss, and finance companies saw a gain of 0.3%. From a year prior, total consumer credit at credit unions rose 7.8%, while banks experienced a 54.9% gain and financial companies grew 5.6%.
Over the past 12 months, credit unions’ share of the market rose 0.5% to 13.4%. Banks’ share rose 0.5%, and finance companies’ share rose 0.3% to 14.5%.
Student Debt Declines
“For the first time in recent history, student debt is down on a year-over-year basis, according to data from the Federal Reserve,” added Long. “Meanwhile, the Fed's latest Senior Loan Officer Opinion Survey confirmed that banks continue to tighten standards on a broad array of loan products. NAFCU expects growth in consumer credit balances to continue to taper as the economy cools and as lenders keep credit supply tight.”
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