Year of the Credit Card WHY CREDIT CARDS ARE DRIVING CONSUMERS TO OPEN NEW ACCOUNTS IN 2025 AND HOW YOU CAN CAPTURE NEW BUSINESS By Corey Wrinn, Managing Director, Rivel Banking Research 2025 is shaping up to be a landmark year for credit cards, driven by shifting consumer preferences and evolving business needs. Recent Federal Reserve data shows credit card applications hitting their highest levels since pre-pandemic times, with approval rates climbing steadily. Major issuers like Chase and American Express reported record-high application volumes in Q4 2024, indicating sustained momentum into 2025. Rivel’s new research digs deeper into the reasons why credit cards are in demand right now and how financial institutions can advocate for new business, to the right audiences. Opportunities for Growth Within the last year, 43% of U.S. consumers have opened a new credit card account — highest among Gen Z (68%) and millennials (35%). With prices remaining elevated, more households are turning to credit cards for both everyday purchases and large expenses. It also continues to be highly sought after for businesses as it becomes a more common format for vendor payments and cashflow management. In Rivel’s semi-annual research of banking consumers, the credit card has been the most in-demand banking product across both retail and commercial for the last two years. For consumers, the demand is higher than checking accounts, savings accounts, and loan products, including mortgages and auto loans. For businesses, credit cards are outpacing credit lines, checking accounts and treasury management in demand. Looking to the future, the opportunity on the retail side lies with those younger consumers who have not yet established their credit or spending habits fully, and those slightly older consumers who need access to credit today. Demand for a new card is generational, as the following chart shows: Seeking a New Credit Card This Year Currently Has Only One Credit Card Gen Z 44% 55% Millennials 35% 38% Gen X 22% 27% Baby Boomers 12% 22% Just over half of consumers (52%) pay off their credit card balances in full each month, leaving a significant portion carrying debt. The rise of buy-now-pay-later services like Affirm and Klarna has fundamentally shifted how younger consumers view credit-based purchases, making installment payments feel more accessible and less daunting. This shift is particularly pronounced among Gen Z consumers, who are pushing the boundaries of credit utilization. More than half now use between 20-60% of their available credit monthly, a notably higher rate than other generations. Getting to Why Understanding Gen Z’s credit motivations is crucial, as they currently show the highest credit utilization rates and strongest appetite for new financial products. Their primary reasons for opening new credit cards reveal clear priorities — 68% aim to build credit history, 31% seek to increase their credit limits and 24% are attracted by better reward programs. Notably, traditional assumptions about credit card adoption don’t hold true. Factors like upcoming large purchases, diverse card benefits or dissatisfaction with existing cards play minimal roles in consumers’ decisions to open new accounts. An interesting pattern emerges in rewards preferences, as well — while older, established consumers prioritize maximizing reward benefits, younger consumers focus primarily on building credit access and achieving financial stability. Colorado Banker 20
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