Interest in in-store credit cards plunges
Consumer interest in in-store credit cards is waning this holiday season.
Only 29% of consumers said they would be likely to apply for a credit card in-store this holiday season, up from 44% in 2020, according to a report by LendingTree. However, consumers are still slightly more likely to use store cards to shop during the holidays rather than using a buy-now, pay-after option.
In other findings, 42% of consumers have closed a store credit card and an additional 13% have had a store card closed by the issuer. The main reasons for voluntary closures were stopping in-store shopping (46%) and high interest rates (35%). The average APR on a new retail credit card offering was 24.27%, up slightly from 24.24% in 2020 in 2020.
“The average in-store credit card APR is still several points higher than the average for all credit cardsThe report states, âFor example, we found eight cards from six retailers with APRs of 29.99%. Good news: For the second year in a row, no store card we reviewed had an APR of 30% or more. “
More retailers offer in-store credit cards than buy now, pay loans later, although many offer both. Sixty-seven of 126 retailer websites reviewed by LendingTree offered an in-store credit card, while 56% offered to buy now, pay later. However, 42 retailers have made both options available. available.
Among Gen Zs, 32% said they would be more likely to use buy now, pay later – the same percentage who would use a store credit card. But only 9% of baby boomers said they would be more likely to use buy now, pay later, compared to 19% who said store credit cards.
â¢ Only one in three consumers with a store card said they currently have debt associated with that card, up from 49% in 2020.
â¢ Twenty-nine percent of consumers would be more likely to pay with a store card during the holiday season, while 21% would turn to buy now and pay financing later.
â¢ Almost four in ten people with a store card today regretted having opened one in the past.