KBRA Financial Intelligence

Credit Card Growth Slows as Bank Focus Shifts to Quality

Credit card loan balances increased $390 billion between 1Q 2021 and 3Q 2025, representing almost one-third of the $1.2 trillion increase in credit limits throughout that period. However, the proportion of unused credit extended by banks via credit cards has risen faster than balances, helping the total utilization rate remain below 20% throughout 2025. Last year, credit card utilization reached the 20% threshold for the first time since 1992.

Year-over-year (YoY) growth in credit card lending among U.S. banks slowed to 3.2% in 3Q 2025, the slowest rate of annual growth reported in four years. Simultaneously, the latest data from the Federal Reserve Bank of Philadelphia’s FR Y-14M reporting indicated that the number of outstanding credit card accounts held by large banks (those with over $100 billion in consolidated assets) has fallen by more than nine million between year-end 2023 and 2Q 2025—a cumulative decline of 1.5% throughout that period. KBRA Financial Intelligence (KFI) data shows that institutions with over $100 billion in assets are the lenders for 92.4% of all outstanding bank-issued credit card loans.

Amid a slowdown in credit card debt accumulation, borrowers’ payment activity continues to follow the two divergent paths that (KFI) highlighted last year. Although the percentage of active accounts making only the minimum payment on their cards was 10.8%—below the all-time high of 11% reached in 4Q 2024—this cohort has grown in size from about 9% three years ago. Meanwhile, the share of accounts paying off their entire balance increased to a three-year high, representing 35.9% of accounts. A further 27.9% are making payments above the minimum but below the full balance, suggesting that some account holders are gradually increasing their carried balances.

The Philadelphia Fed’s large bank survey indicates that newer borrowers are generally higher quality than those in previous years, as just 16.2% of new credit card accounts were issued to recipients with a credit score below 660, down from over 25% in 4Q 2021. In addition, those with credit scores below 660 have received only 3.6% of new commitments in dollar terms in each of the past two quarters—the lowest reading recorded in series history.

The plurality of proactive borrowers helps explain why delinquency and charge-off rates on consumer credit cards have fallen throughout 2025. Call report data analyzed by KFI indicates that delinquency among all credit card loans extended by U.S. banks decreased by 23 basis points (bps) throughout the past year. Declines in credit card loan delinquency can be observed among credit card lending from institutions above and below the $100 billion asset threshold.