Payments on Credit Card Debt Decreased by More Than 25 Percent in Past 2 Weeks as Americans Look to Safeguard Finances and Increase Emergency Funds
MX, the leading digital transformation platform for banks, credit unions, and fintechs, announced new research findings on consumer spending trends and mobile banking adoption, amid increased economic uncertainty and anxiety over Covid-19.
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MX data shows that mobile banking engagement increased by more than 50 percent since December and the amount that consumers are putting toward paying off their credit cards decreased by more than 25 percent in the last two weeks, as consumers look to safeguard finances and increase emergency funds.
“Americans are turning to mobile banking as a way to take control of their finances and plan for their economic future,” said Ryan Caldwell, founder and CEO of MX. “With increased consumer engagement across mobile banking applications, financial institutions have the responsibility to not only deliver a great user experience, but also to provide meaningful advice and guidance that’s critical to the financial well-being of customers, especially during times of economic uncertainty. It all starts with clean financial data.”
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According to the American Payroll Association, more than 70 percent of Americans live paycheck to paycheck, and Bankrate’s Financial Security Index found that three in 10 Americans have no emergency savings. A MX survey of more than 1,000 U.S. consumers took a deeper look at consumer sentiment on savings and the key drivers behind why Americans exceed their monthly budgets. Survey results include:
- More than 70 percent of people say that it’s important to put money away for a rainy day or for unexpected expenses; however, fewer than half put away more than 10 percent of their monthly income
- More than 50 percent of Americans attribute going over their budget to monthly living expenses (e.g. mortgage, rent, utilities or auto loans), with 1 in 4 Americans exceeding their budget primarily on entertainment and luxury items.
Additionally, nearly 60 percent of people say that their primary financial institution doesn’t help them become financially stronger; however, this could change as financial institutions prioritize digital initiatives and serve up insights to customers.