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Americans Feel the Financial Burden of COVID-19, With 65% Relying on Credit Cards to Make Ends Meet as the Pandemic Continues, According to Marqeta's 2021 State of Credit ReportUS consumers have turned to credit en masse to help ease the financial burden brought on by the pandemic, according to a new survey by Marqeta (NASDAQ:MQ), the global modern card issuing platform. The company surveyed 1,500 consumers across the United States to learn about their attitudes toward credit products, such as credit cards and Buy Now, Pay Later (BNPL) solutions, and how they're using them in the aftermath of COVID-19. Marqeta's new survey shows that credit cards are still king, with 78% of American consumers reporting using credit cards and 70% reporting using them at least once a week. With the pandemic bringing on new financial distress, credit cards were also a reliable source of stability for consumers. Over half of consumers said they increased their credit card usage during the pandemic and 65% said they used credit cards to help make ends meet. Credit cards also provided additional layers of support for users, with over two-thirds of consumers saying cash back has been their most valuable reward. While credit cards helped keep Americans above water, alternative forms of credit continued to grow in popularity throughout the pandemic, most notably BNPL solutions. Almost half of all consumers (47%) surveyed said they've used a BNPL solution, up 27% from Marqeta's 2020 survey, with over one-third of BNPL users saying they started during the pandemic. With credit card users growing tired of credit card interest rates, the results show that the convenience and flexibility of BNPL solutions make them a potential long-term credit solution for Americans:
Marqeta's survey also provides intel into what consumers are looking for next from their credit card and BNPL providers. Almost 3-out-of-4 consumers (73%) said they think there should be more solutions available to help them build their credit and expressed their interest in either secured credit-cards or being able to use BNPL services to build credit. With 63% of BNPL users saying they plan on using these options to replace their credit cards. When it comes to credit card rewards, outside of cash back and travel points, 64% of consumers said they are interested in non-traditional options, including cryptocurrencies, lottery rewards or stock options. "The pandemic has changed the way consumers are thinking about credit and what they want from their providers," said Mowry. "It shows how the credit market is changing and that financial services should take notice of the new opportunities for innovation in credit offerings." Download the full report here: https://www.marqeta.com/resources/resource/2021-state-of-credit
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