Consumer Credit Increases in Third Quarter Despite Bank Lending Tightening


The Federal Reserve’s latest G.19 Consumer Credit Report shows rising trends in consumer credit, excluding loans secured by real estate, through September 2019.

In September, consumer credit increased at a seasonally adjusted annual rate of 2.8 percent from the previous month, with revolving debt1 decreasing by 1.2 percent and nonrevolving debt2 increasing by 4.2 percent. Consumer credit totaled $4.1 trillion on a seasonally adjusted basis, with $1.1 trillion in revolving debt1 and $3.1 trillion in nonrevolving debt2. This is an increase of $9.5 billion from the previous month, with the decrease in revolving debt of about $1 billion partially offsetting the increase in revolving debt of about $11 billion. September marks the second consecutive month in which revolving debt has decreased.

The deceleration of consumer credit is consistent with the tightening lending standards reported by banks in the most recently released Senior Loan Officer Opinion Survey, particularly in approving credit card applications from borrowers with weaker credit as compared with the standards exhibited towards the same borrowers at the beginning of the year. Despite the deceleration in the latest month, overall, the third quarter finished with an increase in consumer credit at a seasonally adjusted annual rate of 5 percent. The below figure shows the quarterly changes in consumer credit.


  1. Revolving credit plans are largely composed of credit card debt but also include home equity lines of credit (HELOCs). These may be unsecured or secured by collateral and allow a consumer to borrow up to a prearranged limit and repay the debt in one or more installments. The G.19 Consumer Credit report excludes HELOCS and home equity loans, as they are secured by real estate.
  2. Nonrevolving credit is closed-end credit extended to consumers that is repaid on a prearranged repayment schedule and may be secured or unsecured.

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