Q3 credit CIF (cards-in-force) continue to grow despite a saturated U.S. market driven by an expanding sub-prime marketplace and the aggressive marketing of high-end rewards cards. Over the past year, the total CIF is up by nearly 21 million, and growing more 300 basis points (bps) over the prior twelve-month period. Mastercard continues to blow the doors off the competition in the U.S.
U.S. credit/charge cards-in-force (CIF) in the third-quarter (3Q/19) for the Major 4 (Visa [V], MasterCard [MA], American Express [AXP] and Discover [DFS]) was up 3.1% year-on-year (YOY), compared to 3.0% YOY gain in the prior year. At the end-of-the-period (EOP) for 3Q/19, there were 691.8 million U.S. credit/charge CIF compared to a revised 685.7 million for 2Q/19, and 671.1 million for 3Q/18, according to figures collected by CardData and CardBuzz.
Q3 Credit CIF Analysis
Of the 20.7 million credit/charge CIF added by the Major 4 over the past year, Mastercard contributed 22.0 million. American Express made up 1.3 million, Visa lost about one million, and Discover also lost some ground. The current four-year CAGR (compound annual growth rate) is now running at 1.81%, according to analysis by RAM Research and Bankcenter.
There was very little credit/charge CIF YOY growth in 2017 and 2018 in the U.S. but a reversal is afoot. With low funding rates, the market for unsecured credit cards to consumers with credit scores below 660 is going full steam in the U.S. with new entrants every quarter. Mastercard has largely benefited by this trend. At the same-time American Express has been ramping up marketing, upgrading existing U.S. high-end programs, introducing new consumer and business reward cards, plus incentivizing merchants, opines Robert McKinley, Senior Analyst for CardFlash, CardData, and head of PYRPTS.
Visa U.S Credit/Charge Cards-in-Force
Visa U.S. credit/charge CIF for 3Q/19 edged down by 0.3% YOY to an estimated 335 million, compared to a revised 334 million in the prior quarter, and a revised 336 million in the year ago quarter. (Visa reports CIF on a one-quarter lag basis.) In the third-quarter of 2015 Visa had 329 million U.S. credit/charge CIF. Visa U.S. credit/charge CIF is currently growing at a 0.45% CAGR.
Mastercard U.S Credit/Charge Cards-in-Force
MasterCard U.S. credit/charge CIF for 3Q/19 grew 7.9% YOY to 240 million, compared to a revised 235 million in the prior quarter, and a revised 218 million in the year ago quarter. In the third-quarter of 2015 Mastercard had 186 million U.S. credit/charge CIF. Mastercard U.S. credit/charge CIF is currently growing at a 6.58% CAGR.
American Express U.S Credit/Charge Cards-in-Force
American Express U.S. credit/charge CIF for 3Q/19 increased 2.5% YOY to 54.3 million, compared to 54.0 million in the prior quarter, and 53.0 million in the year ago quarter. In the third-quarter of 2015 American Express had 56.4 million U.S. credit/charge CIF. American Express U.S. credit/charge CIF is currently growing at a 0.59% CAGR (unadjusted). Adjusting for the divesture of cobranded cards, notably Costco, in 2016, the American Express CAGR is -0.94%.
Discover & Diners U.S Credit/Charge Cards-in-Force
Discover and Diners U.S. credit CIF for 3Q/19 decreased 2.5% YOY to an estimated 62.5 million, compared to an estimated 62.7 million in the prior quarter, and an estimated 64.1 million in the year ago quarter. (Discover no longer discloses CIF or account data and is now based on PDV, outstandings, and internal guidance) In the third-quarter of 2015 Discover had an estimated 62.6 million U.S. credit/charge CIF. Discover U.S. credit/charge CIF CAGR is currently -0.04%.
Complete Third-Quarter Report on Major 4 U.S. Credit/Charge Cards-in-Force [2015-2019] Available for Immediate Download
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SOURCES: Visa; Mastercard; American Express; Discover; RAM Research; CardData; CardTrak; CardFlash; Bankcenter; CardBuzz; PYVNTS; PYRPTS; Ruebud Media; Red 3 Media; The Cardworthy Company; Robear’s List