Credit scores up in pandemic, Experian says
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U.S. consumers’ credit scores are up and their card balances and delinquencies are down, according to a new report from Experian.The credit bureau on Oct. 20 released key findings from its annual State of Credit[3] report, which showed U.S. consumers have less debt on average and are carrying fewer credit and retail cards.
Consumers have also made a six-point jump in their average credit scores[4] from 2019, making the new average VantageScore 688.
Add that news to FICO’s recent finding that the average FICO score[5] is up to 711 and it paints a picture of Americans managing their debt responsibly, even during the COVID-19 pandemic.
Additionally, the average number of cards consumers carry slightly decreased from to 3.07 in 2019 to 3.0 in 2020 and average credit card balances went down from $6,629 in 2019 to $5,897 in 2020.
“Against the backdrop of the pandemic, we are seeing promising signs of responsible credit management, including lower credit card balances, decreased utilization rates and fewer missed payments – especially among younger consumers,” said Alex Lintner, group president of Experian Consumer Information Services, in a press release.
“Educating Americans about the factors included in their credit profile and how to manage these responsibly is of critical importance, especially on the road to economic recovery,” he added.
See related: 10 tips to improve your credit score[6]
Younger borrowers drove a lot of the results
The Experian study showed that younger borrowers – Gen Zers and millennials – significantly contributed to the results through their responsible credit behavior.