Younger credit cardholders are more likely than the general population to apply for a new card in the next year, new survey data from Auriemma Consulting Group suggest.
But twenty-somethings continue to use credit cards sparingly compared with debit cards, the firm says.
Some 21% of credit cardholders ages 25 and younger the firm surveyed in January said they likely would apply for a new credit card in the next 12 months, up from 15.8% who said so in a similar poll Auriemma conducted in July.
Among all 420 U.S. credit cardholders surveyed in January for Auriemma’s CardBeat report released last month, 11% said they likely would apply for a new card in the next year, unchanged from July.
The data suggest that card issuers may have “a significant opportunity” to market cards to younger adults who would use them for occasional purchases, Patricia Sahm, Auriemma managing director, tells PaymentsSource.
Young adults are “wedded” to using debit cards for everyday purchases, but many of them are interested in having a credit card for major purchases, such as electronics, and travel, Sahm says.
“Younger consumers don’t want to revolve a balance on their groceries or lattes at the coffee shop, but anecdotal and other evidence suggests they will consider doing so for a big-screen TV,” she says.
Credit cardholders younger than 25 also show a greater propensity than the general population for “segmenting” their purchases among various cards, Sahm says.
“We are seeing evidence that young adults are more likely to sort their payments among various cards, for various purposes, because they are using their cards to manage their finances,” she says.
A recent McKinsey & Co. survey found that consumers’ preferences for paying with a credit or a debit card are fairly entrenched, and most consumers in their 20s show a strong preference for paying with debit and an aversion to credit (
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