The average credit card borrower debt during the second quarter ended June 30 dropped for the fifth consecutive quarter, to $4,951, down 4.1% from $5,165 the previous quarter, according to a TransUnion analysis of credit card trends.
Each quarter TransUnion looks more than 200 variables in consumes credit report; many involve credit card stats like 60,90, 120 days past due, percentage of active credit cards, new trade lines that are new credit card accounts and average balance of new credit cards.
The credit bureau defines average debt as the aggregate balance on all bank-issued credit cards for an individual bankcard borrower. The highest amount of credit card debt for the U.S. consumer was in the first quarter of 2009 at $5,775.
For the second quarter of this year among U.S. states, Alaska had the highest average card debt at $7,148, followed by Tennessee at $5,564 and Hawaii at $5,594.
Consumers in [the highest-debt states] tend to purchase a lot of goods via mail order or catalog, Ezra Becker, director of consulting and strategy in the TransUnion Financial Services business unit, says in theorizing why their card debts are relatively high. “Consumers in Hawaii, on the other hand, have to absorb the increase distribution costs of goods to the island state,” he tells PaymentsSource.
The state with the lowest average card debt was Iowa at $3,792, followed by North Dakota at $4,097 and West Virginia at $4,104.
“A different demographic in the Midwest states and regional economic dynamics tend to drive more conservative card spending, which is reflective in those states’ credit card-debt levels,” says Becker.
