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Where is the credit The introduction of buy now, pay later (BNPL), an approach
to lending that involves small, simple micro-loans to
card industry accommodate shoppers, has given consumers another
choice. When shopping online, most of us are offered the
option to buy now and pay later at the checkout, and we're
heading in 2023? offered a long list of potential companies to choose from.

Already, the BNPL model has caught so much attention
that an estimated one in three shoppers is choosing this
option when checking out online. In 2021 alone, the
companies offering these services saw a 102.3 percent
increase in users—and interest in BNPL continues to grow.
Despite this shift, people are still using their credit cards.
(For further BNPL data, see https://bit.ly/3XhNNr5.)

The value of rewards

Rewards cards have also been an enticing option for
shoppers for years. After all, who doesn’t want to get
something extra when they are spending money? As
long as credit card companies offer good rewards, they
have a much higher chance of catching customer interest.
However, to maintain interest, companies may need to
focus on ensuring that those rewards are actually used:
By Nick Cucci roughly 70 percent of rewards credit cardholders have
Fluid Pay unused rewards, according to Lending Tree data, https://
bit.ly/3YBcboH.
very year, consumer behavior shifts, so product
types will always go in and out of style. The Of course, if credit cards do not offer a way to make
credit card industry is no different. And there is sure these rewards are used, they run the risk that their
E no denying that consumer behaviors involving customers will forget the value of the card in the first place.
credit are changing fairly quickly. Is this good or bad for According to an August 2022 Wells Fargo survey, https://
credit card companies? More importantly, is it good or bwnews.pr/3YFvPjg, since 65 percent of credit cardholders
bad for consumers? value rewards now more than ever before, it's crucial
to incentivize them to use rewards before someone else
Additionally, although times might be changing, the value sweeps in, offering balance transfers and other rewards
of the credit card industry continues to stand strong. It they may find appealing.
even appears to be gaining more interest from potential
customers. But what do the numbers say about credit card Consumers want credit cards that offer them incredible
use and the modern consumer’s habits? perks. And more people are choosing to explore credit
card rewards for digital channels, with the topic becoming
In 2023, the credit card industry's market size is $166.8 more popular among finance-savvy influencers on the
billion. Since this is no small amount of value, many internet.
observers believe that, despite ongoing concerns about
inflation and a potential recession, credit cards are Credit card rates and debt levels
alive and thriving. In the last five years, the value of the In 2023, credit cardholders are getting bad news: rising
industry has increased by roughly 1.4 percent annually
(see IBISWorld, https://bit.ly/3lo79O6, for further details on rates. During 2022, these rates reached record highs
(see https://cnb.cx/3YGmmZk). This trend is expected
the market).
to continue. With rates increasing, it is becoming even
Credit cards versus BNPL more important for consumers to pay off their debts.
Unfortunately, however, credit card debt is on the rise as
For the longest time, credit cards have been an appealing well.
option for anyone looking to make a purchase and pay for
it later. It has been a fairly common consumer practice that Credit card usage changed significantly in response to the
if you don’t have the money for a particular purchase, you pandemic and the significant changes it brought about.
consider putting it on a credit card rather than taking out However, as inflation rises and more people struggle,
a loan. However, for modern shoppers, this seems to be credit card usage seems to be growing.
changing.

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