Late credit card payments fall

November 23, 2009|Associated Press

NEW YORK - For the first time in a decade, more people paid their credit card bills on time in the third quarter this year than in the second quarter.

The delinquency rate on bank-issued cards like those bearing MasterCard and Visa logos fell to 1.1 percent for the June-to-September period, from a rate of 1.17 percent in the prior three months, according to credit reporting agency TransUnion.

The 6 percent drop is significant not just for its size but also for its timing, since delinquency rates usually rise in the third quarter from the prior period, said Ezra Becker of TransUnion’s financial services group.

Taken together with the more than 11 percent decline seen between the first and second quarters, the results indicate that consumers are getting better at handling their debt.

It’s too early to tell how the recession has affected consumer behavior long-term, Becker said, but the holiday shopping season will provide some clues. The National Retail Federation, a retail trade group, expects total holiday sales will drop 1 percent from last year.