There’s finally good news for credit card lenders who have been frantically writing off delinquent debts as uncollectable for years.
According to the American Bankers Association, the number of consumers who have been unable to pay off their credit card debt dropped below 4 percent for the first time in about eight years. Bank card delinquencies declined half a percentage point to 3.88 percent in the first quarter of this year, marking the first time the rate of delinquency has dipped that low since the second quarter of 2002. The number is also below the average rate over the last 15 years, which stands at 3.93.
“It’s clear that consumer balance sheets are improving. People are borrowing less, saving more and building wealth. These are all positive signs,” noted ABA chief economist James Chessen.
According to a Reuters report, the service sector expanded for the sixth straight month in June, though the rate at which it grew slowed to its lowest point since February. So that good news, the report said, might give some indication that the economic recovery isn’t going as well as some numbers might lead consumers to believe.