6 Baffling Facts About Credit

Woman Shopping Online with Credit Card

Credit is a fact of life in modern America. Building good credit is necessary for those entering adulthood and understanding the impact of credit is something that every merchant should understand.

Take a look at some of these unbelievable facts about credit in the last few years:

Responsible credit card holders paid $490 billion dollars at the end of 2014.

Actual payments made on credit card debt are totaled quarterly and put into a public report. Each of the major creditors is included, and total credit card payments can be determined from their data.

Payments on credit card debt steadily rose throughout 2013 and 2014, starting at about $360 million. It could mean the economy is improving or the wage gap is closing. The bottom line is that merchants looking to take advantage will have less to worry about when getting paid for their products and services.


American Express reaps the largest portion of credit card payments.

But who are those responsible card holders who are dutifully paying their debts?

American Express customers seem to be making the most payments among holders of cards from major creditors. Credit giants such as JPMorgan, Bank of America, and CapitalOne are getting paid, but the closest leader is JPMorgan, who still brings in a healthy $20 million dollars less.

American Express’s secret weapon seems to be its targeted card offers. They focus on the wealthy who are more likely to pay on a regular basis and have the funds to maintain a large credit to debt ratio. JPMorgan keeps the silver medal by having a very large client base, giving them the flexibility to be able to afford the risk.


There are over 1.5 billion credit cards in circulation.

That’s not just in the United States. The world’s combined card volume is quickly catching up with the total population of Earth. The latest estimate of world population is 7 billion people. That means about 20% of the world already has a credit card.

However, we have to consider that only developed countries use plastic and that most cardholders have multiple cards. While it’s difficult to talk about credit card use based on just the number of cards available, the sheer number means that there’s plenty of credit ready to be used.


Creditors make about a 65% profit on each new customer every year.

On credit cards alone, that is. Advertising, emailing, and other marketing and overhead expenses put the cost of each new customer at about $80. It’s a small price to pay for creditors – they make about $120 off of those customers every year. Since the entire expense of gaining a new customer is paid off in the first year, the remainder is pure profit.


In mid-2014, the average household had a credit card debt of $15,604.

This is, of course, spread across all of a household’s credit cards, but still paints a vivid picture of America’s dependence on credit. It could be due to economic trouble, as 20% of households admitted in 2013 that a large portion of their credit card debt goes toward living expenses. Debt for living expenses has steadily decreased in the last few years, however.

$15,604 is a large amount of debt, and on credit cards it carries a heavy interest burden. If paid off over the course of 30 years, it will accrue enough interest to jump all the way up to almost $40,000 on your average credit card.


Internet gateway payment is taking over credit cards.

It’s easy to see that storefronts are losing their steam in the modern shopping world. Internet shopping websites are taking over the market with shipping that sends goods to your home in a matter of days, sometimes less. All-purpose websites like Amazon cover general needs, but specialized merchants are taking advantage of the availability of internet gateways and starting to sell targeted products to customers.

In 2015, a whopping 78 percent of people said that they use the internet to do their shopping. Electronics and clothing are among the most popular industries for online shopping, and more expensive products sell better online.


Credit purchases are changing fast, and merchants should take heed of recent trends if they want to maximize their sales. Card holders would do well to become more financially literate as it can lower their debts and increase sales, boosting the American economy.

Leading through intentional change.


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