Consumer credit growth in the United States slowed to an annual rate of 1.9% in August, according to Federal Reserve data. This marks the slowest pace since May, down from a revised 4.1% in July. Total outstanding consumer credit reached $5.197 trillion, compared to $5.189 trillion in the previous month.
The revolving credit segment, which includes credit cards, contracted at an annual rate of 4.2% in August. Balances in this category fell to $1.352 trillion from $1.357 trillion. Conversely, nonrevolving credit, comprising auto and student loans, grew at a 4.1% annual rate, reaching a total of $3.844 trillion.
Government-held consumer credit, primarily student loans, rose to $1.622 trillion from $1.608 trillion. This increase is attributed to disbursements made ahead of the fall academic term. Meanwhile, the average annual percentage rate for interest-bearing credit card accounts climbed to 22.36% in the third quarter.
Financing costs for new vehicles also increased during the third quarter. The average rate for 60-month loans rose to 7.54% from 7.14%, while rates for 72-month loans reached 7.2%. Personal loan rates remained relatively stable at 11.9%.
Research from PYMNTS Intelligence indicates that 36% of consumers used credit card installment plans by March 2026, up from 23% in April 2025. Usage of Buy Now, Pay Later services remained steady at approximately 15%.
