Writer: Lucy Lazarony
Editor: Lillian Guevara-Castro
Reviewer: Adam West
Key Takeaways
- Credit card customers with credit scores below 660 had the greatest gain in average purchase volume, according to a report from the Federal Reserve Bank of Philadelphia.
- Card rates were near record highs with a 24.5% average APR on general purpose credit cards.
- Delinquencies improved and net charge-offs declined in 2025.
American consumers are spending more on their credit cards, but they are also paying their bills, according to a report from the Federal Reserve Bank of Philadelphia. The report examined large bank credit card and mortgage data from the third quarter of 2025.
The report found that aggregate credit card balances and purchase volume increased moderately year over year. That means consumers continue to reach for their credit cards when making purchases.
And it was consumers with lower credit scores doing much of the shopping. Consumers with credit scores below 660 made the biggest gain in average purchase volume, according to the report.
Higher Credit Card Rates
The report also pointed out that consumers who carry credit card balances face near record high interest rates with the average purchase APR for general purpose credit cards at 24.5%.
As ACA International reports, APRs on general purpose credit cards have remained high despite the prime rate falling by 125 basis points between mid-2024 and the third quarter of 2025. The average APR for general purpose credit cards dipped by only 27 basis points during that time period.
Good News on Delinquency Rates
All the measures of credit card delinquencies improved in 2025, and net charge-offs also declined in both the second and third quarters. What is the reason for these improvements?
The report points to a cumulative impact of tighter access to credit cards for the riskiest borrowers.
In contrast, mortgage delinquencies increased slightly year over year in 2025, according to the report.
Number of Credit Lines Hold Steady
The number of credit card accounts was essentially unchanged from 2024. This indicates that consumers are relying on existing credit card accounts and credit lines to do their credit card shopping.
Past Due Improvements
Credit card accounts that were 30 days, 60 days, and 90 days past due have improved year over year. The net charge-off rate also eased on a yearly basis with declines in the second and third quarters.
Even so, the report finds that all credit indicators are still elevated when compared with levels prior to the pandemic.
Minimum Payments Show Slight Improvements
The share of credit card accounts making only minimum payments showed a small improvement. This measure dipped slightly to 10.7% in the third quarter of 2025 from the previous year.
Good Performance for Credit Cards
All in all, despite the economic uncertainties that consumers may be facing, they are paying their credit card accounts.
″Taken together with broader economic indicators, the data present a mixed picture: Consumers are navigating economic uncertainty, yet credit card performance continues to improve,” a Philly Fed spokesperson told PaymentsDive.
The Bottom Line
Credit card spending was up and delinquencies down as more consumers better managed their credit card spending and purchases, according to a study by the Federal Reserve Bank of Philadelphia. As far as average purchase volume goes, it was consumers with credit scores below 660 that made the most gains.
