- Contents
- *Overview
- What you need to know
- Key issues covered in this Report
- COVID-19: Market context
- Economic and other assumptions
What you need to know
Credit cards are the most typical forms of payment, and now with an increased reluctance to use cash due to the COVID-19 pandemic, consumers are increasing their use of credit. Overall consumer debt has actually decreased in 2020 due to sheltering-in-place and consumer spending changes, but ultimately consumers’ reliance on credit will remain.
Key issues covered in this Report
The impact of COVID-19 on consumer behavior and the credit card market.
Effects of a US recession on debt accrual and consumer spending
Attitudes toward payments during the COVID-19 pandemic
Motivations to apply for a new credit card
COVID-19: Market context
This update was prepared in October 2020.
The first COVID-19 case was confirmed in the US in January 2020. On March 11, the World Health Organization declared COVID-19 a global health pandemic, and on March 13, President Trump declared a national emergency in the US.
Across the US, state-level stay at home orders rolled out throughout the months of March and April, and non-essential businesses and school districts across the nation closed or shifted to remote operations. At the time of writing, all 50 states have seen significant resurgence of COVID-19 and are beginning to re-evaluate relaxed restrictions, allowing businesses to operate with varying levels of social distancing measures in place.
Economic and other assumptions
The analysis provided reflects an estimated range of the market’s prospects in light of the upheaval caused by the COVID-19 crisis. This forecast is driven by Mintel analysts’ understanding of consumer behavior in this market, alongside an evaluation of how exposed this sector is to the crisis and how quickly demand will return to previous levels once a degree of normality returns to the market. Mintel’s economic assumptions are based on the updated forecasts released by the CBO on July 2, 2020. The CBO expects US GDP to fall by 5.8% in 2020 and recover to 4.0% growth in 2021. The CBO projects the unemployment rate to average 10.6% for the year, with an 8.4% rate for 2021. The current uncertainty means there is wide variation in the forecasts.
