1、Marqeta 2023State of Credit Report2Table of ContentsPart 1Even loyal consumers have their eye on what credit cards to apply for nextPage 4Part 3Customer loyalty to brands,rather than banks,highlights the opportunity for Embedded FinancePage 13Part 5Credit remains a major financial lifeline for consu

2、mers during major shopping seasonsPage 18Part 2Rewards speak louder than wordsPage 10Part 4Buy Now,Pay Later is serving as a credit adjacent servicePage 16ConclusionPage 21IntroductionPage 33The credit card is one of the most popular payment methods in the world.According to Forbes,a whopping 84%of

3、adults in the US had a credit card in 2021,and almost three-quarters(73%)of Americans had a credit card by the age of 25,making credit cards the most common first credit experience for young American adults.A similar trend is seen in the UK,with an estimated 34.5 million people,or two-thirds of UK a

4、dults,having at least one credit card.Credit is a well-known and widely accepted lending solution,and consumers rely on it for larger purchase amounts,with consumers surveyed saying they spend an average of$91 per purchase using credit compared to$39 when using debit,thanks to the inherent consumer

5、and business protections along with the rewards mechanism built into many offerings.For Marqetas third annual State of Credit report,Marqeta has surveyed over 2,000 US consumers and 1000 UK consumers to explore just how ready the credit card industry is for disruption as consumer expectations shift

6、toward digital and mobile offerings,personalized rewards and seamless application processes.Here we outline the huge opportunity at hand for businesses and consumers alike,and explore how embedded credit solutions may be the key to it all.IntroductionIntroductionPart 1Part 2Part 3Part 4Part 5Conclus

7、ion4Part 1 Even loyal consumers have their eye on what credit cards to apply for next Considerations also extend past immediate financial gains or losses,with many consumers surveyed highlighting that they consider their future financial position when choosing a credit card.Over three-quarters(77%)s

8、aid that theyd be interested in a credit card that allowed them to move current or future credit card balances to a different card with a lower APR.42%38%36%Interest RatesRewardsCredit limitThe top features that consumers surveyed look at when evaluating a new credit cardFigure 1Consumers shopping f

9、or credit cards are most influenced by interest rates and fees when making decisions about whether to apply.While credit cards may be incredibly popular,consumers do have some specific considerations that must be met before they take the plunge and apply.Economic considerations rank highest here-our

10、 survey revealed that for two-thirds(67%)of consumers surveyed,the fees associated with a credit card impact their decision about whether to apply or not.When asked to rank the top three costs that would impact their decision most when choosing a new credit card,interest charges came top,closely fol

11、lowed by annual fees and balance transfer fees.Comparatively,rewards,lower interest rates and annual fees were ranked as the three most attractive features when evaluating a credit card by consumers.IntroductionPart 1Part 2Part 3Part 4Part 5Conclusion5Similarly,more than half(56%)of consumers said t

12、he impact on their credit score would affect their decision to apply for a new credit card.Just under half(46%)of respondents said a credit card that did not require a hard credit check would increase their interest in applying.Concern about the impact on their credit score was highest among 18-34 y

13、ear olds with 70%surveyed expressing this concern,while just 40%of those aged 51 and over said the same.This could be because 18-34-year-olds are the most likely age group to need a good credit score as they are more likely to apply for a mortgage,make a big life purchase,or be in the process of act

14、ively building their credit score upon leaving education than any other age bracket.Brand recognition and trust also play a part in the decision-making process,with almost one-third(31%)of UK-based respondents citing trust in the brand supplying the credit card as an important factor,while just 21%o

15、f US respondents said the same.IntroductionPart 1Part 2Part 3Part 4Part 5Conclusion6Among consumers surveyed,younger consumers are driving new credit card applications Satisfaction levels vary among consumers.Over half(58%)of consumers feel that there is room for improvement when it comes to their c

16、redit cards,while 42%reported being very satisfied.UK respondents are less satisfied than their American counterparts with 68%of UK-based consumers surveyed sharing that they feel their credit card has room for improvement,vs.53%Consumers surveyed who plan to apply for a credit card in the next 12 m

17、onthsUKUS36%22%0%20%40%60%80%100%Figure 3Figure 2Consumers surveyed who said they were likely to apply for a new credit card in the next 12 months(by age)45%52%44%11%Ages18-25Ages26-34Ages35-50Ages50+of US respondents.Perhaps due to the fact that credit cards are more widely adopted in the US vs.the

18、 UK and have therefore developed more in regards to building personalized experiences.Regardless of how satisfied they are with their current credit card,almost 1-in-3(31%)consumers surveyed said that they plan to apply for a new credit card within the next 12 months.On average,US consumers surveyed

19、 were more likely to say that they are planning to apply for a new credit card in the next 12 months(36%),compared to those based in the UK(22%).This response was highest among 26-34-year-olds with 1-in-2(52%)saying they planned to apply for a new card,compared to just 1-in-10(11%)of those over age

20、50 saying the same.Consumers aged 35-50 years old sat somewhere in between with 45%stating that they plan to apply for a new credit card within the next 12 months.IntroductionPart 1Part 2Part 3Part 4Part 5Conclusion7Older consumers are twice as likely to be satisfied with their credit card than youn

21、ger consumers with just 27%of 18-25 year olds and 33%26-34 year olds reporting that they are very satisfied,compared with 62%of consumers aged over 65.For the two-thirds(69%)of consumers surveyed who do not plan to apply for credit in the next 12 months,69%declared that they could be persuaded if in

22、centivized.This figure was highest among 18-34-year-olds,of whom a substantial 82%said they could be persuaded by some kind of incentive.For 18-25-year-olds,the most popular incentive revolves around monetary rewards,with 35%declaring that cashback would incentivise them to apply for a new credit ca

23、rd,29%saying that a major points sign-up bonus would,and 27%saying that the ability to choose spend categories to get extra points or miles would incentivise them.Comparatively,for the 26-34-year-old age bracket,cashback(42%),0%interest(37%)and the ability to transfer their credit card balance to a

24、new card with lower or 0%interest rate(30%)were most attractive.Those aged 51+were slightly less likely to be persuaded to apply for a new credit card by incentives with just over half(53%)saying that incentives would make them apply.69%of consumers surveyed said they could be persuaded if some form

25、 of incentive was offeredIntroductionPart 1Part 2Part 3Part 4Part 5Conclusion8Figure 4Factors that would persuade consumers who arent looking for their next credit card to apply for a new one18-25 year olds26-34 year olds34-50 year olds51+year oldsCashback:35%0%interest:41%Cashback:42%No incentives

26、would be persuasive:47%Major sign up bonus:29%Cashback:38%0%interest:37%Cashback:29%Ability to choose spend categories:27%Ability to transfer credit card balance:27%Ability to transfer credit card balance:30%0%interest:26%3IntroductionPart 1Part 2Part 3Part 4Part 5Conclusion9The credit ca

27、rd opens the door to selling additional products to cardholders It would seem that once consumers are committed to a credit card provider,they are happy to explore other financial services,giving banks and brands a chance to deepen their relationship with that customer.More than half(51%)of consumer

28、s reported that they have more than one financial product from their credit card provider.However,the likelihood of a consumer having more than one financial product from their credit card provider decreases with age.Almost two-thirds(62%)of consumers surveyed aged 18-50 reported having at least one

29、 additional product with their credit card provider,compared to just one-third(37%)of those aged above 51 years old.Sixty-one percent of consumers surveyed who reported having multiple products with their credit card provider had a credit card first and then added additional financial products over

30、time.US consumers were far more likely than UK-based consumers to have taken this path,with 69%and 42%respectively sharing that they had accessed an additional financial service.This also fluctuated with age-nearly three-quarters(72%)of younger consumers(18-50)said they had their credit card first b

31、efore adding additional financial products,compared to just 35%of consumers ages 51+.Of consumers surveyed who do not have other financial products with their main credit card provider,21%surveyed said that they are likely to add another financial product from that same provider in the next 12 month

32、s.An overwhelming majority of survey respondents(80%)said that they would be interested in a credit-like card product that charges their account right away,like a debit card,to help build credit.62%37%18-5050+Percentage of consumers surveyed who have at least one additional product with credit card

33、provider69%42%Consumers surveyed who started with credit card and added financial services with the same providerFigure 5Figure 6United StatesUKIntroductionPart 1Part 2Part 3Part 4Part 5Conclusion10Part 2 Rewards speak louder than wordsTop of the consumer credit wishlist:personalized rewards and cas

34、h backWhen asked to identify the biggest benefit of credit cards over other payment methods,rewards came out on top,with just under half(49%)of consumers flagging it as the biggest benefit,up from 44%in 2022.Age plays a role in consumer responses here,with those surveyed aged 66+placing higher than

35、average value in rewards(60%),and those aged 18-65 placing lower than average(36%)value in them.Rewards further reign supreme in the US where consumers are almost twice as likely(58%)to cite rewards as the biggest benefit when compared to UK respondents(32%).US respondents also place more value on b

36、uilding and establishing their credit score with 33%citing that as a benefit compared to just 24%in the UK.58%32%US vs.UK consumers surveyed who cited rewards as biggest benefit of credit cardFigure 7United StatesUKIntroductionPart 1Part 2Part 3Part 4Part 5Conclusion11The survey highlighted that the

37、 three most popular rewards among consumers are cashback(66%),multipurpose points(27%)and gift cards(27%).Cashback is most popular in the US with 71%of consumers surveyed flagging this as their preferred benefit vs.46%of those in the UK saying the same.Interestingly,slightly more women(68%)use cashb

38、ack than men(63%),while men are almost twice as likely than women to use airline miles(27%vs 15%)and hotel points(26%vs.14%).0%15%25%35%45%55%65%75%CashbackHotel pointsThe most popular rewards among credit card holders surveyedFigure 866%Gift cardsAirline miles27%Multipurposepoints27%21%21%Introduct

39、ionPart 1Part 2Part 3Part 4Part 5Conclusion12When asked what would get them to use another credit card more,roughly two out of five (42%)consumers surveyed said that better rewards would,followed by lower interest rates(34%)and a higher credit limit(27%).UK respondents place more importance on lower

40、 interest rates in motivating them to use another card more 40%compared to 33%in the US.Its arguably not surprising that a lower interchange environment such as in the UK,and therefore a less rewards focused ecosystem,would skew in favor of interest rates as a key driver.Interestingly,over three-qua

41、rters(77%)of those surveyed think that there is at least some room to make rewards more personalized around personal interests or spending habits.Fifty-nine percent of consumers declared that they would want extra points or cash back to spend on specific merchant categories where they spend the most

42、 money.This number is higher among the younger generation with those surveyed aged 18-25(58%)and 35-50(47%)saying so.More than 4-in-5(83%)consumers surveyed prefer consistent,recurring rewards instead of large promotional offers.Although a strong desire among all age groups surveyed,the appetite for

43、 rewards does appear to increase with age with 76%of 18-25 year olds flagging this desire,jumping to 92%among those aged 66+sharing that they prefer recurring rewards.Figure 9Better rewardsLower interest ratesHigher credit limitFactors that would sway consumers surveyed to change their top-of-wallet

44、 credit card42%34%27%77%of consumers surveyed think that there is at least some room to make rewards more personalized around personal interests or spending habitsIntroductionPart 1Part 2Part 3Part 4Part 5Conclusion13Part 3 Customer loyalty to brands,rather than banks,highlights the opportunity for

45、Embedded Finance Think top of phone,not top of wallet Mobile payments have become increasingly popular and commonplace thanks to years of digital innovation and increasing smartphone adoption.In 2022,mobile wallets accounted for roughly half(49%)of global e-commerce payment transactions.Our survey r

46、eveals a similar trend,with 63%of consumers stating that they use their credit card more in its digital form than they use it in its physical form.This is especially true of UK-based respondents of whom 68%said they use their card digitally more,compared to 61%of US-based consumers.Its not just paym

47、ents that are going digital.Consumers are shopping online more than ever,in fact as of early 2023,around 43%of US-based consumers shared that they would prefer to shop mostly online rather than in-store,making it the country with the highest online shopping preference.In the UK,similar trends are se

48、en.In retail alone,online sales made up 27%of overall retail sales in the country in 2022,more than double the amount from exactly one decade prior.When asked how they make purchases with their credit card,almost 1-in-3(32%)consumers stated that they make over half of their purchases online as oppos

49、ed to in-store.Forty five percent of consumers shared that they use their physical card for less than a quarter of their purchases,and 61%shared that they use it for less than 50%of their purchases.This is especially true of younger consumers with 78%of 18-24 year olds using a physical card for less

50、 than 50%of their purchases vs.57%of 35-44 year olds saying the same.78%57%Ages 18-24Ages 35-44Percentage of consumers surveyed who use their physical credit card for less than 50%of purchasesFigure 10IntroductionPart 1Part 2Part 3Part 4Part 5Conclusion14Consumer loyalty lies with brands,not the ban

51、kWith the mass adoption and increased accessibility of digital payments,consumers have started to expect more embedded experiences from their favorite brands.Forty one percent of consumers surveyed shared that they own a credit card affiliated with a brand.US consumers were more than twice as likely

52、 to own a credit card affiliated with a brand than UK-based consumers(50%vs.24%).While consumers aged 26-50 were the most likely(47%)to own a credit card through a brand.In short,in the US the rewards have justified the effort.For other regions where unit economics are more heavily regulated-the key

53、 to bridging the gap is to reduce the effort required and to make the launch of brand specific credit cards more accessible.Figure 11Consumers surveyed who said they owned a credit card affiliated with a brand(by geography)YesNo50%24%YesNoUnited StatesUKIntroductionPart 1Part 2Part 3Part 4Part 5Conc

54、lusion15Consumers look to the brand,not the banks when it comes to brand-affiliated credit cards.Half of consumers(50%)who own a brand-affiliated credit card said that their card can only work for purchases made at that store.Sixty one percent of consumers surveyed who own a co-branded card who cons

55、ider themselves to be a customer of the brand or store instead of the bank providing the financial service behind the scenes.In turn,over half(53%)of consumers consider the brand or store to ultimately be responsible for customer service,instead of the bank.62%54%Consumers surveyed who own a co-bran

56、ded card who consider themselves a customer of the brand or store vs.the bankFigure 12United StatesUKIntroductionPart 1Part 2Part 3Part 4Part 5Conclusion16Part 4 Buy Now,Pay Later is serving as a credit adjacent service that consumers are interested in using to build out their credit profile.Buy Now

57、,Pay Later users are keen to explore additional credit offeringsBuy Now,Pay Later(BNPL)allows consumers to purchase products without needing to pay the full amount upfront.The flexibility that this provides has ensured BNPLs popularity among consumers with 54%of those surveyed stating that they use

58、it for convenience,and 50%stating they use it to help them budget.When it comes to how consumers make their purchases via BNPL,there is a fairly even split among consumers.One-third(35%)of those surveyed shared that they use their debit card to make BNPL purchases,while 32%said they use their credit

59、 card.One-in-two(51%)BNPL users surveyed shared that they currently use other financial services through their BNPL provider.This response was highest among younger consumers with 54%of 18-25 year olds,and 58%of 26-50 year olds using another service.These figures dropped by nearly half among the old

60、er generation with just 30%of 51-65 year olds,and 23%of those aged 66+saying the same.IntroductionPart 1Part 2Part 3Part 4Part 5ConclusionFigure 13Percentage of BNPL users who use additional financial services through BNPL provider0%25%50%75%100%30%58%54%23%Ages18-25Ages26-50Ages51-65Ages66+17Two-th

61、irds(65%)of consumers using BNPL declared that they would be interested in accessing other financial services through BNPL providers,up from 48%in 2022.Once deemed the Credit Card Killer,consumers now consider BNPL as a tool to build credit and get extra credit cards.64%of those surveyed who are loo

62、king to build credit shared that they would be interested in using BNPL to build their credit score in order to get a credit card.Forty-eight percent of consumers reported that they are interested in using BNPL service from a credit provider that lets them pay over time for a small fee rather than b

63、eing charged interest.65%YesNoPercentage of consumers surveyed who would be interested in accessing additional financial services through their BNPL providerFigure 14Consumers in the 35-50 year old age bracket were the most interested of all ages with nearly three-quarters(73%)saying so.26-34-year-o

64、lds followed closely behind with 69%saying that they would be interested in accessing other financial services,while those aged 66+were the least interested with just 32%saying so.64%Consumers surveyed who would be interested in using BNPL to build their credit scoreFigure 15IntroductionPart 1Part 2

65、Part 3Part 4Part 5Conclusion18Part 5 Credit remains a major financial lifeline for consumers during major shopping seasonsCredit card spending is expected to increase this holiday season Given that many holiday favorite retailers such as department stores and toy shops report hitting 36%and 34%of th

66、eir annual sales during the final quarter of the year,its no surprise that nearly half(49%)of consumers surveyed report that they increase their spending during the holiday season.IntroductionPart 1Part 2Part 3Part 4Part 5Conclusion49%of consumers surveyed report that they increase their spending du

67、ring the holiday season19When it comes to where theyre shopping this year,48%of consumers say that they plan to shop in person,while 32%say that they plan to complete their shopping online.When it comes to what consumers are spending their money on during the festive period,there are some notable di

68、fferences between US and UK-based respondents.US consumers surveyed said that they spend most of their money on gifts(61%),followed by entertainment such as eating out and concerts(55%)and clothing(45%).While in the UK,consumers spend the most on eating out and concerts(54%),clothing(47%)and then gi

69、fts(39%).61%39%55%54%45%47%GiftsConcertsClothingGiftsConcertsClothingWhat US and UK consumers surveyed spend money on during the holiday seasonFigure 16United StatesUKIntroductionPart 1Part 2Part 3Part 4Part 5Conclusion20Consumers arent immune to the rising cost of living,with 48%surveyed sharing th

70、at they are concerned about being able to make purchases this holiday season.Concern is marginally higher among US consumers(51%)than UK consumers(43%).When asked how they plan to pay for their purchases during the holiday season,61%of consumers revealed that they plan to use a credit card,55%plan t

71、o use a debit card and 40%said cash,or a combination of the three.While US and UK-based consumers were broadly aligned on which payment methods theyd be using(card vs.cash vs.BNPL)the weighting varied greatly depending on the consumers location:CreditcardDebitcardCashBNPL67%52%46%22%CreditcardDebitc

72、ardCashBNPL60%51%27%17%The greatest fluctuation in responses can be seen in regards to cash payments which are far more popular in the US than in the UK.This was slightly more true of US consumers where 49%said this,vs.39%in the UK.How consumers surveyed plan to pay for their holiday purchases this

73、yearFigure 17United StatesUKIntroductionPart 1Part 2Part 3Part 4Part 5Conclusion21ConclusionHistorically there have been huge barriers to launching credit card programs considering the enormous effort,knowledge and finance required,which far outweighed the resulting payoff for many businesses.Thanks

74、 to the innovations in embedded finance,this is no longer the case,and businesses can launch their own programs in mere weeks.As the effort to launch a credit card reduces,we can expect to see more brands taking advantage of the rewards it can bring.There is a large opportunity at hand for businesse

75、s taking this step into the world of credit.As consumers become more reliant on their credit cards to optimize their spending,maximize rewards and incentives,and boost their credit rating,they in turn expect more from their providers.Companies and brands are well positioned to serve this demand,alre

76、ady having consumer trust and loyalty,and most importantly keen insight into what they want and the ability to give it to them.By providing credit experiences that meet their customers where they are,consumers receive the more tailored experiences they crave,and businesses may unlock new revenue streams and insights while creating stickier relationships,and happier customers.IntroductionPart 1Part 2Part 3Part 4Part 5C