Significant decline in consumer credit demand

The New York Fed shared the findings of its Credit Access Survey, which is conducted every four months as part of the Survey of Consumer Expectations. According to the data, which reveals a significant decline in consumer credit demand this year, the application rate for all types of credit fell from 44.8 percent recorded last year to 41.2 percent this year. This rate also remained below the 45.8 percent level seen in 2019, before the COVID-19 pandemic.

Despite the decrease in credit demand, it was noted that the application rate for credit cards maintained its strong trend. While the credit card application rate reached 29 percent as of October, it was 26 percent for the year as a whole. Application rates for credit card limit increase requests rose to 14.4 percent for the year, while they fell to 12.7 percent for auto loans and 5.7 percent for mortgage loans.

The overall rejection rate for credit applications rose from 18 percent last year to 20.1 percent this year. The proportion of those planning to apply for credit in the next 12 months fell to 25.9 percent for the year as a whole.