MW A record 111 million Americans can't pay their credit-card bills in full
Andrew Keshner
The estimate from consumer advocates comes as the Federal Reserve holds interest rates flat
Millions of people are facing deepening credit-card debt, a new report says. People carrying a balance on their cards paid an average 22.30% annual percentage rate in the last quarter of 2025.
While the Federal Reserve kept its key interest rate the same on Wednesday, a trillion-dollar credit-card problem keeps growing for Americans.
More than 111 million people could not pay off their monthly credit-card bills in full at the end of last year, marking a new record, according to new estimates from consumer advocates. That's roughly 2 million more people unable to pay in full compared to the end of 2024, they noted.
These card holders now owe banks more than $1 trillion - and most are inching closer to maxing out their credit lines, according to researchers at the Century Foundation, a progressive think tank, and Protect Borrowers, a nonprofit group that advocates for borrowers.
The balances have grown over the years, as well as the borrowing costs on those balances, researchers said.
At a time when many people are facing increasing costs for cars, insurance, child care, utility bills and more while wage growth has been modest, bigger credit-card debts are a symptom of those struggles, said Mike Pierce, one of the report's authors.
"People are putting basics on their credit card as life gets more expensive and it's the way families are papering over the affordability crisis and trying to stay afloat," said Pierce, executive director and co-founder of Protect Borrowers.
On Wednesday, the Fed kept its federal funds rate in place at a 3.50% - 3.75% target rate, and signaled one possible rate cut for this year. Still, the central bank said the conflict with Iran and the resulting challenges on energy prices clouded that outlook.
The Fed's benchmark rate is a key starting point from which many banks determine the lending rates for credit cards. People carrying a balance on their cards paid an average 22.30% annual percentage rate in the fourth quarter of 2025, Fed data showed. That's down from 22.80% at the same point in 2024.
While the annual percentage rates for credit cards have ticked lower, unpaid balances have increased. For cardholders with an unpaid balance on at least one card, the average total balance was $6,715 in the fourth quarter, according to TransUnion (TRU), one of the three major credit reporting bureaus.
Survey data also showed the rising pressures. Six in 10 credit-card holders with debt said they've carried balances for at least a year, according to a Bankrate survey in January. That was up from 53% in late 2024.
The transition to deeper credit-card debts has been years in the making. Federal Reserve Bank of New York data shows Americans' collective credit-card debt passed the $1 trillion mark in 2023, as the economy absorbed four-decade high inflation during the Biden administration.
One semi-bright spot: Credit-card delinquencies began to level off at the end of last year after climbing steadily since late 2022, according to the New York Fed.
But even if delinquency rates are showing signs of stabilization, Pierce said that's not the full story. "Missing a monthly payment is a five-alarm fire" where something has to go deeply wrong in a person's financial situation, he said.
"What we see here is the thing before that," Pierce added. "Families' finances are brittle and over-leveraged."
Read also: Here's the exact amount of money you need to make to be financially secure
What about a 10% rate cap on credit-card APRs?
In January, President Donald Trump said he would cap credit-card interest rates at 10% for a year. That hasn't happened yet. A 10% cap was one part of Trump's campaign pledges for lower prices.
The banking industry has fiercely criticized the idea of a cap. Limiting APRs would backfire and curb credit lines and credit-card rewards for millions, people in the banking industry cautioned.
Credit-card interest eats up a relatively small share of consumers' wallets, according to the Consumer Bankers Association. Healthcare, housing, car payments, groceries and energy bills are the costs really gnawing at wallets, according to an analysis from the trade organization.
Reports of record-high credit-card balances have painted too severe a picture, the organization said in a Wednesday blog post, noting that those figures don't take into account the increase in cardholders or inflation.
Yet credit-card interest is big business, Pierce and other researchers wrote. Their report said cardholders have paid $134.5 billion more in interest than what they would have paid if the rate cap was in effect at the 2025 start of the Trump administration.
Since January 2025, households have paid $240.7 billion in interest alone, according to the report's analysis and projections, using a database with credit information from millions of consumers.
As Pierce sees it, a 10% cap is "one of the few arrows left in the quiver for the White House really struggling to address the affordability crisis."
It was inflation during the Biden administration that forced Americans to rack up credit-card debt, White House spokesman Kush Desai said. The Trump administration has been focused from the start on getting Americans "back on a better financial footing," he said.
"Credit-card debt growth will continue to slow as Americans' financial health improves," Desai said, citing the Trump administration's economic agenda of tax cuts, deregulation and pro-growth policies.
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-Andrew Keshner
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March 19, 2026 08:00 ET (12:00 GMT)
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