ARLINGTON, Va.—Total consumer credit fell 2.1% in August (seasonally adjusted, annualized) after two months of solid gains.
However, NAFCU Chief Economist and Vice President of Research Curt Long highlighted that this represented a 0.4% increase when compared to year-ago levels.
"In the Federal Reserve’s most recent survey of bank lending standards, nearly three in four banks said they had tightened standards on credit cards over the past three months," said Long. "But with the wind down of fiscal stimulus, there will be growing demand for short-term credit.
“NAFCU expects consumer credit growth to continue to decline over the near term, leading to more pain for households," added Long.
Long noted that revolving credit drove the decline in August, while nonrevolving credit posted its smallest increase since April.
Total consumer credit for credit unions rose 0.3% in August from the previous month, compared to no increase for banks and a 0.6% increase for financial companies. From a year prior, total consumer credit at credit unions rose 1.8%, while banks saw a 3.7% drop and financial companies saw a 1.3 increase.
Credit unions' share of the market remains unchanged from a year ago at 11.9% in August. Meanwhile, banks' market share fell 0.2% to 40% and financial companies' is also unchanged at 13.2%.