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Understanding the Rise in Retail Credit Card Debt in 2022

In 2022, total retail credit card debt saw a significant increase of 6.5%, reaching $118.9 billion. This growth was observed across various credit scores and states, with younger generations contributing notably to the rise in balances. Despite the popularity of buy now, pay later options, retail cards remain a relevant payment method for many consumers.

Retail Credit Card Debt Trends

Retail credit cards, unlike traditional credit cards, are often limited to specific stores or groups of stores. As retail traffic surged in 2022, the total balance on these cards grew by $7.3 billion. This increase, however, was modest compared to the 16% rise in traditional credit card debt, which reached $910 billion.

Snapshot: Total Retail Card Debt

• 2019: $125.2B
• 2020: $114.9B
• 2021: $111.6B
• 2022: $118.9B (+6.5%)

As supply chain issues eased, durable goods like appliances and furniture, often bought with store credit cards, returned to shelves. Consequently, the average balance for retail cardholders increased from $1,046 in Q3 2021 to $1,109 in Q3 2022.

Snapshot: Average Retail Card Balance

• 2019: $1,171
• 2020: $1,068
• 2021: $1,046
• 2022: $1,109 (+6%)

Balance Increases Across Credit Scores

Experian data shows that retail card balances increased uniformly across different FICO® Score ranges, with growth rates between 4.4% and 7.3%. These increases were slightly below the inflation rate of 8.2% during the same period.

Average Retail Card Balance by FICO® Score Range

• Poor (300-579): $1,264 to $1,356 (+7.3%)
• Fair (580-669): $1,578 to $1,693 (+7.3%)
• Good (670-739): $1,645 to $1,718 (+4.4%)
• Very Good (740-799): $839 to $894 (+6.6%)
• Exceptional (800-850): $352 to $377 (+7.1%)

State-by-State Analysis

In 2022, all states and Washington, D.C., saw increases in average retail card balances, ranging from 2.3% to 10.1%. Texas had the highest average balance at $1,443, while Hawaii had the lowest at $761.

States With the Largest Increases in Retail Card Balances

• Maine: $881 to $970 (+10.1%)
• District of Columbia: $861 to $938 (+8.9%)
• Oregon: $795 to $864 (+8.8%)
• California: $913 to $988 (+8.2%)
• Washington: $868 to $939 (+8.1%)

Generational Spending Trends

Younger generations, particularly Generation Z and Millennials, saw the most significant increases in retail card balances in 2022. Generation X had the highest average balance at $1,422, while older generations saw minimal changes.

Average Retail Card Balance by Generation

• Generation Z (18-25): $661 to $736 (+11.3%)
• Millennials (26-41): $1,079 to $1,195 (+10.7%)
• Generation X (42-57): $1,343 to $1,422 (+5.8%)
• Baby Boomers (58-76): $1,009 to $1,032 (+2.2%)
• Silent Generation (77+): $538 to $541 (+0.5%)

Retail Cards in the Modern Payment Landscape

Despite the rise of alternative payment methods like buy now, pay later and mobile payments, retail cards continue to be a valuable option for many consumers. Retailers and card issuers benefit from the revenue and higher margins these cards provide.

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