Closed-Ended Credit Surged in February


The Federal Reserve’s latest G.19 Consumer Credit Report shows rising trends in consumer credit, excluding loans secured by real estate, through February 2020.

In February, consumer credit increased at a seasonally adjusted annual rate of 6.4% from the previous month, with revolving debt1 increasing by 4.6% and nonrevolving debt2 increasing by 7 percent. Consumer credit totaled $4.2 trillion on a seasonally adjusted basis, with $1.1 trillion in revolving debt and $3.1 trillion in nonrevolving debt. This is an increase of $22.3 billion from the previous month, with revolving debt decreasing by $4.2 billion and non-revolving credit increasing by $18.1 billion.

Interestingly, nonrevolving debt, in absolute terms, experienced its highest monthly change since September 2015, when it increased by $21.2 billion from the previous month. Consistent with this observation, commercial banks’ interest rate on 24-month (i.e., 2-year) personal loans sank to the lowest level since November 2016 to 9.63%. In November 2016, it was 9.45%, but in the history of the series, these rates have been trending down.

As consumers’ liquidity needs increase in response to macroeconomic shocks, they are likely to attempt to take advantage of lower interest rates that banks offer, particularly on shorter-term and low-risk loans. However, credit conditions are tightening as the virus-related downturn continues.



  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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