US Credit Card Applications Soar to Pre-Pandemic Levels

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American consumers are applying for credit cards at pre-pandemic rates — an increase that is broad-based across age and credit score groups — according to the New York Federal Reserve.

See: The Quickest Ways To Pay Off Your Credit Card Debt
Find: 5 Best 0% APR Credit Cards

The application rate for credit cards rose throughout 2021, reaching 26.5% in October 2021 — 10.8 percentage points higher than its October 2020 level, which was a series low — the New York Fed data shows.

In addition, data indicates that the application rate for credit card limit increases also rebounded from its October 2020 low of 7.1% to 11.3% in October 2021, just below its October 2019 level of 12.0%. This increase was also statistically significant across age and credit score groups.

Erica Seppala, financial analyst for, told GOBankingRates that as the world starts to recover from the effects of the COVID pandemic, consumers are feeling more confident in taking on more debt — and in applying for loans and credit cards again.

“As we approach the holidays, consumers are looking for a backup source of funding for emergencies, and borrowers that are still playing ‘catch up’  from loss of wages (due to the pandemic).  So, it should be no surprise that credit card applications are on the rise,” Seppala said. 

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She warns, however, that consumers should be extremely cautious moving forward, as individuals and businesses are still recovering from the pandemic. Lenders may loosen their borrowing requirements, approving consumers that wouldn’t have previously qualified for higher credit limits — if they even qualified at all — prior to the pandemic, she said.

“Consumers should read the terms and conditions for every card they’re applying for, as high interest rates and annual fees quickly stack up,” she added. “People should also be cautious of how much they’re spending and should pay down debt as quickly as possible to avoid paying interest for an extended period of time. It’s easy to get comfortable as our world returns to normal, but racking up credit card debt only to potentially face financial challenges in the near future, can be disastrous.”

Finally, she warns that consumers who do opt to open new credit accounts should be mindful of how credit cards can impact credit scores.

“While opening a new credit card to lower credit utilization —  or to pay off a higher interest card — may be a wise move, applying for or opening multiple cards or carrying a high balance could have negative effects on both your credit score and your finances.”

However, some experts suggest that the New York Fed report doesn’t paint a full picture — and that while credit card applications are rebounding, this circumstance is mostly due to a surge in marketing.

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See: 9 Best Credit Cards for Beginners Who Want To Build Credit
Find: How Many Credit Cards Should You Have? And More Credit Card Questions Answered

“If you follow the money instead, credit card balances are still well below pre-pandemic levels due to record consumer liquidity from government programs and the rapid adoption of alternative FinTech products,” Jeanniey Walden, chief innovation and marketing officer for DailyPay, told GOBankingRates.

“Some consumers are using ‘buy now pay later’ instead of credit cards, while others are avoiding the need for credit altogether through on-demand pay programs offered by their employers,” she said.

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About the Author

Yaël Bizouati-Kennedy is a full-time financial journalist and has written for several publications, including Dow Jones, The Financial Times Group, Bloomberg and Business Insider. She also worked as a vice president/senior content writer for major NYC-based financial companies, including New York Life and MSCI. Yaël is now freelancing and most recently, she co-authored  the book “Blockchain for Medical Research: Accelerating Trust in Healthcare,” with Dr. Sean Manion. (CRC Press, April 2020) She holds two master’s degrees, including one in Journalism from New York University and one in Russian Studies from Université Toulouse-Jean Jaurès, France.
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