Recent research found that more households have been using credit cards to pay for vital expenses, in some cases due to a lack of present funds.
The 2012 National Survey on Credit Card Debt of Low and Middle-Income Households, conducted by Demos, found that many consumers were having issues with credit card debt because of spending on daily needs, not frivolous purchases, Tulsa World reports.
“40 percent of households used credit cards to pay for basic living expenses such as rent or mortgage bills, groceries, utilities or insurance, in the past year because they did not have enough money in their checking or savings accounts, a rate comparable to 2008,” the report stated.
The 2012 average household debt of $7,145 was lower than during 2008, when the recession began. Part of the reason for the reduced numbers may be the fact that consumers are not able to get as much credit as they were in previous years.
Another way that many have been using the merchant services-related payment system is by leveraging travel rewards. According to Alpha Flight Guru CEO Tim Gibson, hotels and airlines have given away $50 billion in benefits to customers using selected cards.Back To Blog