ICYMI: Why Smart Lending and Responsible Borrowing Keep the Economy Running
A new op-ed from consumer finance expert Erica Sandberg highlights how the competitive credit card market benefits consumers and the economy as a whole. There are, however, a number of misguided pieces of legislation on Capitol Hill that would impose government price controls on this highly valued financial tool that millions of Americans use each and every day.
As Sandberg says in the op-ed:
"The credit card industry is delivering real results. It supports household financial security, drives GDP growth, and powers small business success. Yet policymakers continue to consider increasingly restrictive regulations that could undermine all of this.
"Heavy-handed policies that limit credit availability, impose arbitrary restrictions, or make qualification unreasonably difficult won’t just hurt card issuers — they’ll hurt the very consumers and small businesses these policies claim to protect.
"Consumers will lose access to essential credit. Small businesses will face reduced consumer spending. Economic growth will slow.
"The data is clear: When credit cards work as intended, everyone benefits. The system isn’t broken. It’s working."
To read the full op-ed, click HERE or keep reading below.
Opinion: Why Smart Lending and Responsible Borrowing Keep the Economy Running
By Erica Sandberg
CardRates.com
Oct. 28, 2025
For as long as I can remember, credit card issuers have faced criticism regarding lending practices and credit availability. I started in this business way back in the mid-1990s as a credit counselor for a nonprofit organization. Pointing fingers at these products and their issuers for a variety of financial ills was commonplace.
Blaming big business for perceived — and sometimes real — problems is easy, but there is always another side. Credit cards can be instrumental in building financial well-being, and not just for the account holder but for the economy at large.
Despite this, questions about qualification standards and credit limit management persist in public and political discourse. The narrative remains familiar: greedy lenders enabling reckless borrowers.
However, consumer responsibility matters. Smart lending practices matter. Together, these two factors have created something genuinely powerful: a system that kept America functioning when the world stopped, and that continues to fuel economic growth today.
So I’m here now to give credit where credit is due. Here’s why.
Credit Cards are Economic Stabilizers
During the 2020 pandemic disruption, credit card availability proved instrumental in maintaining consumer purchasing power and economic continuity.
According to an October 2025 Consumer Bankers Association report, credit cards were instrumental in America’s speedy economic recovery during and after the COVID-19 pandemic.
In fact, credit card spending accounts for 22.4% of gross domestic product. This share has been increasing over the years, with credit card spending totaling $5.83 trillion and representing 33% of personal consumption expenditures.
Credit card spending as a share of personal consumption expenditures and GDP grew by roughly six percentage points from 2015 to 2022 as consumers used the liquidity provided by credit cards to make ends meet during a period of high inflation.
Consumer spending was a key contributor to GDP growth, rising 4.2% in Q4 2024, with spending on durable goods up 12%, the biggest quarterly jump since early 2023.
Recent data also indicates meaningful shifts in credit card usage patterns since the pandemic. The share of active credit card accounts making just the minimum payment fell in the first quarter of 2025 after a year of consecutive quarter-over-quarter increases.
Even with higher credit costs, credit card performance strengthened in the first quarter of 2025, with delinquencies of 30-or-more days falling across both accounts and balances.
In other words, good news.
Credit Cards Help Consumers Achieve Financial Security
Credit cards function as essential financial tools, offering households reliable access to liquidity for routine expenses, emergency situations, and credit history development. This accessibility supports economic participation and long-term wealth building across income levels.
In the first quarter of 2025, personal consumption expenditures represented 67.7% of the nation’s gross domestic product, the primary measure of the size of the U.S. economy.
Credit Cards Promote Small Business Growth
Consumer spending financed through credit cards directly drives GDP expansion and supports small business growth. Credit card transactions have grown from an estimated 31 billion transactions worth $2.8 trillion in 2015 to 55.3 billion transactions worth $5.42 trillion in 2022 — an increase of over 75% and 90%, respectively.
Credit Cards Provide Rewards and Promotions
Credit card rewards programs drive consumer spending and economic growth by incentivizing credit card usage. When consumers redeem cash back, travel benefits, or points, these rewards stimulate secondary spending throughout the economy.
Families take vacations, businesses reduce travel costs, and lower-income households gain purchasing power.
This creates a cycle in which rewards encourage card adoption, increase merchant revenue, and generate additional consumer spending. Billions of dollars in annual rewards flow back into the economy, supporting retail, hospitality, and travel industries while strengthening consumer purchasing power and sustaining economic growth.
Don't Mess with Success
The credit card industry is delivering real results. It supports household financial security, drives GDP growth, and powers small business success. Yet policymakers continue to consider increasingly restrictive regulations that could undermine all of this.
Heavy-handed policies that limit credit availability, impose arbitrary restrictions, or make qualification unreasonably difficult won’t just hurt card issuers — they’ll hurt the very consumers and small businesses these policies claim to protect.
Consumers will lose access to essential credit. Small businesses will face reduced consumer spending. Economic growth will slow.
The data is clear: When credit cards work as intended, everyone benefits. The system isn’t broken. It’s working.
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