Despite recent indications of dwindling consumer credit card balances, delinquency rates among Americans climbed during the third quarter, according to a recent TransUnion report. The findings offer further uncertainty over the state of consumer confidence.
Specifically, the national credit card delinquency rate - the ratio of borrowers 90 or more days past due - grew to 0.71 percent during the July-September period - the first increase since the fourth quarter of 2009. Average credit card debt per borrower rose $63 to reach $4,762. However, that figure remains near record-low levels, pointing to consumers continued reluctance to incur further debt amid widespread unemployment adn stagnant wage growth. "We find card delinquency being driven by a number of factors," said Ezra Becker, a vice president of research and consulting at TransUnion. "One such driver is the changing risk profile of consumers opening new credit card accounts. In the face of competition for prime consumers and the clear deleveraging efforts of those consumers, lenders have been gradually shifting their focus to the sub-prime market." This could have a long-term effect on consumer credit risk management
, as sub-prime lending in the housing market was seen as an underlying force of the 2008 financial collapse.