Marqeta’s 2021 State of Credit Report highlights the continued reliance upon credit cards for many Americans, despite the economic easing of coronavirus’s impact on finances. The new report shows that nearly two-thirds of consumers rely on credit cards to make ends meet, plus a growing preference for Buy Now, Pay Later services. Here are the full findings of the 2021 State of Credit Report:
2021 Marqeta State of Credit Findings
Marqeta’s annual State of Credit Report shows that while credit cards remain king of all things credit, they are losing ground to Buy Now, Pay Later (BNPL) services. The 2021 report shows that 78% of US consumers reporting using credit cards, and 70% of respondents using their credit cards at least once a week.
Worryingly, 65% of respondents said they were relying on credit cards to help make ends meet, showing that personal finances haven’t entirely recovered from the economic impact of the coronavirus pandemic. Additionally, over half of respondents said their credit card usage has increased during the pandemic.
Other findings of the State of Credit Report include:
- Cash back remains the most popular credit card reward, with more than two-thirds of respondents preferring cash back to travel rewards
- 63% of respondents want non-traditional rewards, such as cryptocurrencies
- 73% of consumers wanted more options to build credit, including secured credit cards
Buy Now, Pay Later Growing in Popularity
The Marqeta State of Credit Report also shows the continued trend of Americans preferring BNPL services over credit cards. Almost half of the respondents (47%) said they used a BNPL service in the last year – up 27% from the same time in 2020. Of those who have used BNPL, 78% said they planned to use those services again in the future.
Other BNPL findings in the study include:
- 70% of consumers who have used a BNPL solution said they see themselves using BNPL in place of their credit card
- 59% of consumers who have used a BNPL solution said they find it easier to manage multiple plans than their credit card statements
“Our new survey shows that credit cards are providing consumers with the financial support they’ve needed throughout the pandemic, with American consumers far more engaged with credit card rewards programs than the UK or Australia. However, we’re also seeing a shift in consumer behavior and growth in Buy Now, Pay Later use and alternative credit solutions that provide consumers with flexibility and lower interest rates,” said Darren Mowry, Chief Revenue Officer at Marqeta in a press release.
“The pandemic has changed the way consumers are thinking about credit and what they want from their providers,” said Mowry. “It shows how the credit market is changing and that financial services should take notice of the new opportunities for innovation in credit offerings.”
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