By Corey Wrinn, Rivel Banking Research
For many consumers, credit cards (not checking or savings accounts) are now the core of their relationship with their bank or credit union. In fact, almost two-thirds of consumers do no other business with their credit card issuers. In 2025, banks and credit unions need to work harder to make the credit card the beginning of the customers’ journey, not the end.
2025 is shaping up to be a landmark year for credit cards, driven by shifting consumer preferences and evolving business needs. Recent Federal Reserve data shows credit card applications hitting their highest levels since pre-pandemic times, with approval rates climbing steadily. Major issuers like Chase and American Express reported record-high application volumes in Q4 2024, indicating sustained momentum into 2025.
Rivel’s new research digs deeper into the reasons why credit cards are in demand right now and how financial institutions can advocate for new business, to the right audiences.
Opportunities for Growth
Within the last year, 43% of US consumers have opened a new credit card account – highest among Gen Z (68%) and Millennials (35%). With prices remaining elevated, more households are turning to credit cards for both everyday purchases and large expenses. It also continues to be highly sought after for businesses as it becomes a more common format for vendor payments and cashflow management.
In Rivel’s semi-annual research of banking consumers, the credit card has been the most in-demand banking product across both retail and commercial for the last two years. For consumers, its demand is higher than checking accounts, savings accounts and loan products, including mortgages and auto loans. For businesses, credit cards are outpacing credit lines, checking accounts and treasury management in demand.
Looking to the future, the opportunity on the retail side lies with those younger consumers who have not yet established their credit or spending habits fully, and those slightly older consumers who need access to credit today.
Consumers seeking a new credit card in 2025 that currently only have one credit card
| Seeking a new credit card this year | Currently only has one card | |
|---|---|---|
| Gen Z | 44% | 55% |
| Millennials | 35% | 38% |
| Gen X | 22% | 27% |
| Baby Boomers | 12% | 22% |
Just over half of consumers (52%) pay off their credit card balances in full each month, leaving a significant portion carrying debt. The rise of buy-now-pay-later services like Affirm and Klarna has fundamentally shifted how younger consumers view credit-based purchases, making installment payments feel more accessible and less daunting. This shift is particularly pronounced among Gen Z consumers, who are pushing the boundaries of credit utilization. More than half now use between 20 to 60% of their available credit monthly, a notably higher rate than other generations.
Getting to Why
Understanding Gen Z’s credit motivations is crucial, as they currently show the highest credit utilization rates and strongest appetite for new financial products. Their primary incentives for opening new credit cards reveal clear priorities — 68% aim to build credit history, 31% seek to increase their credit limits and 24% are attracted by better reward programs.
Notably, traditional assumptions about credit card adoption don’t hold true. Factors like upcoming large purchases, diverse card benefits or dissatisfaction with existing cards play minimal roles in consumers’ decisions to open new accounts. An interesting pattern emerges in rewards preferences, as well — while older, established consumers prioritize maximizing reward benefits, younger consumers focus primarily on building credit access and achieving financial stability.
Why did you open your most recent credit card?
| Drivers | Increase Credit Limit | Found a Better Benefit or Reward |
|---|---|---|
| Gen Z | 31% | 26% |
| Millennials | 35% | 30% |
| Gen X | 26% | 34% |
| Baby Boomers | 20% | 36% |
The current marketplace offers unprecedented credit card choices, creating both opportunities and challenges for financial institutions. A revealing statistic from Rivel’s research shows that 38% of cardholders maintain no other banking relationship with their card issuer. This presents a significant opportunity for banks and credit unions to attract new customers, particularly affluent, older consumers with higher spending patterns, without requiring them to switch their primary banking relationship.
Rewards on Their Terms
Three key factors are driving increased credit card adoption — inflation concerns, credit access needs and rewards preferences. Daniel Bednar, Chief Strategy Officer at OceanAir Federal Credit Union in California, sees this reflected in their members’ behavior, "As we head into 2025, we’re seeing strong demand for credit cards as members increasingly seek financial tools that offer competitive rates and robust rewards programs. People want rewards on their terms — when and how they want them."
Financial institutions are evolving beyond traditional offerings, integrating engagement-focused features to strengthen cardholder relationships. As Bednar notes, "Beyond that, we’re aiming to make our cards more holistic by integrating engagement and milestones into our rewards program, ensuring we celebrate and reward our members for their ongoing relationship with us."
Future Reliance on Credit
Spending patterns across credit card users show remarkable consistency — with groceries, restaurants, and travel emerging as the top categories — each used regularly by over 40% of consumers across all age groups. This consistency suggests that regardless of age, consumers view credit cards as essential tools for both everyday necessities and discretionary purchases.
Income levels, however, reveal distinct usage patterns. Households earning above $100,000 annually are more likely to use their credit cards for these primary spending categories (over debit or cash) while also maintaining higher rates of full balance payoff. These consumers typically leverage cards for convenience and rewards rather than financing. Lower-income households show increased reliance on credit for essential purchases, though this often translates to carrying monthly balances, highlighting the growing role of credit cards in financial management across economic segments.
This widespread shift toward credit-based spending, regardless of income level, represents a significant evolution in consumer payment behavior. For card issuers, this trend creates multiple revenue streams through interchange fees, interest charges and opportunities for deeper customer relationships. As credit cards continue to cement their position as the preferred payment method for major spending categories, financial institutions that align their offerings with these demonstrated usage patterns — while accounting for income-based differences in customer needs — will be best positioned for sustained growth in the increasingly competitive card market.
As always, ensure your internal and external messaging and marketing around the brand and the specific benefits that your institution offers is clear. Differentiation is essential to growth in the credit card market this year.
Rivel and the Financial Brand continue to be partners in bringing banking professionals exclusive primary research and analysis on US banking consumers monthly. For more information on Rivel Banking Research’s benchmarking, market opportunity highlights and on-hand brand perception insights for your institution, contact: Corey Wrinn, Managing Director, Rivel Banking Research at cwrinn@rivel.com
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