On November 14, the Fed published its annual report on the Profitability of Credit Card Operations of Depository Institutions. The report examined the performance of specialized institutions known as “credit card banks,” defined as a bank with a minimum of half of its assets in consumer lending and at least 90 percent of that lending in credit card or revolving credit. According to the report, as of the end of 2024, eight banks met this definition and accounted for 29 percent of outstanding credit card balances on all banks’ balance sheets, a decrease in their share of total credit card balances from recent years.

The report highlighted an increase in the use of personal loans offered by traditional banks, finance companies, and fintech lenders for debt consolidation, including refinancing credit card debt. The report also noted significant growth in the buy-now-pay-later market as an alternative payment method to credit cards, especially for online purchases.