American households borrowed $18.1 billion more in July 2026, and revolving credit, the category that holds credit card debt, closed the month at an all time high of $1.3572 trillion. The Federal Reserve published the figures in its G.19 Consumer Credit release at 3 p.m. Eastern on Tuesday, September 8, covering activity through July 31. Total consumer credit outstanding reached $5.1862 trillion, also a record, after expanding at a seasonally adjusted annual rate of 4.2 percent. That was the fastest monthly pace since March 2025 and a clear step up from June, when credit grew at a 3.4 percent rate. The composition matters more than the headline. Revolving balances rose at just a 2.5 percent annual rate, while nonrevolving credit, which covers auto loans and student loans, accelerated to 4.8 percent. Households are still adding debt, but the July increase came mostly from installment borrowing rather than from cards. The report lands seven days before the Federal Open Market Committee meets on September 15 and 16, a decision that will set the prime rate that most variable card APRs are priced against. For the rate side of that equation, see our tracker of consumer credit rates.
Key Takeaways
- Total consumer credit grew at a 4.2 percent annual rate in July, the fastest pace since March 2025.
- Revolving credit hit a record $1.3572 trillion, but grew at only a 2.5 percent annual rate.
- Nonrevolving credit rose at a 4.8 percent rate, adding $15.3 billion in the month.
- The average credit card APR on all accounts was 20.94 percent in the second quarter of 2026.
- The prime rate has held at 6.75 percent for 272 days, since December 11, 2025.
What the July Consumer Credit Report Showed
The Federal Reserve reported that consumer credit outstanding rose to $5,186.2 billion in July from $5,168.1 billion in June, an increase of $18.1 billion. Measured the way the Fed presents it, as a seasonally adjusted annual rate, total credit grew 4.2 percent. The G.19 release puts the annualized dollar flow at $216.7 billion for the month, split between $33.6 billion of revolving credit and $183.1 billion of nonrevolving credit. Those two lines moved in opposite directions relative to recent trend. Revolving growth of 2.5 percent was less than half the 6.0 percent rate recorded in June. Nonrevolving growth of 4.8 percent was nearly double June’s 2.5 percent rate.
The July print reversed a soft spring. In May, total consumer credit grew at only a 0.5 percent annual rate, with revolving balances actually contracting at a 2.0 percent pace. June brought a rebound to 3.4 percent, and July extended it. Even so, the year to date picture remains restrained by historical standards. Consumer credit expanded 2.2 percent across all of 2025 and 2.9 percent in the second quarter of 2026, well below the 7.7 percent rate of 2022. The Fed revised several prior months in this release, a routine feature of the G.19 series that reflects late reporting by lenders.
Card Balances Set a Record as Growth Cooled
Revolving credit outstanding finished July at $1,357.2 billion, the highest level in the history of the series, which the St. Louis Fed carries back to 1968. The month added $2.8 billion to the balance. That record deserves context, because the level and the growth rate are telling different stories. Revolving balances have set a fresh record in most months for the past two years simply because they rarely fall. The growth rate is the more informative number, and at 2.5 percent annualized it sits below the 4.9 percent second quarter pace and below the 3.1 percent rate for 2025 as a whole. Card borrowing decelerated in July even as the total kept climbing.
Credit quality has been improving alongside that deceleration. The Fed’s series on delinquency rates for credit card loans at commercial banks stood at 2.85 percent in the second quarter of 2026, down from 2.91 percent in the first quarter and 3.04 percent a year earlier. Households are carrying a record nominal balance while falling behind on it slightly less often than they were in 2025. That combination is consistent with borrowers who are managing existing balances rather than reaching for new credit, which is what a 2.5 percent growth rate at a 20.94 percent average APR would suggest.
Cars and Tuition Did the Heavy Lifting
Nonrevolving credit, the line that captures auto loans and federal and private student loans, rose $15.3 billion in July to $3,829.0 billion. Of the $18.1 billion total increase, roughly 84 percent came from this category. The 4.8 percent annualized growth rate was the fastest for nonrevolving credit since March 2025, and it stands in sharp contrast to the 1.8 percent rate posted for the full 2025 year and the 2.2 percent rate for the second quarter of 2026.
The terms of credit table in the same release helps explain why. Commercial banks charged an average 7.14 percent on 60 month new car loans in the second quarter of 2026, down from 7.53 percent in the first quarter. The 72 month rate fell further, to 6.97 percent from 7.53 percent. Finance companies, which write a large share of dealer arranged loans, reported an average new car rate of 6.3 percent on an average amount financed of $41,705 over a 67 month term. Installment borrowing got cheaper this spring at the same time revolving borrowing did not, and July’s split reflects that gap.
What This Means for the Rate You Pay
Nearly every variable rate credit card in the United States is priced as the prime rate plus a margin. The prime rate has been 6.75 percent since December 11, 2025, a stretch of 272 days, because the Federal Reserve has not moved its policy target since then. The effective federal funds rate was 3.63 percent on September 7. If the FOMC raises its target by a quarter point on September 16, banks move prime to 7.00 percent within a day or two, and variable card APRs follow on the next billing cycle. Our explainer on why credit card APRs follow the prime rate walks through the mechanics, and the Fed meeting schedule lists the remaining 2026 dates.
Scale that to the record balance. A quarter point applied to $1,357.2 billion of revolving credit is about $3.4 billion in additional annual interest across all cardholders. For an individual carrying $6,000, the same move adds roughly $15 a year, which is small on its own but compounds against an average APR that was 14.60 percent as recently as 2021. Borrowers with balances they cannot clear each month have two levers that do not depend on the Fed. A fixed rate personal loan averaged 11.86 percent at commercial banks in the second quarter, well under the card average. Cash that is not needed for debt paydown belongs in a high yield savings account, where a September hike would push deposit rates in the borrower’s favor rather than against it.
If you are carrying a revolving balance into the September 16 decision, call your issuer this week and ask two questions: what your current APR is, and whether the account is variable or fixed. Variable accounts reprice automatically when prime moves. Fixed rate accounts require the issuer to give you 45 days notice before raising the rate, which buys you a billing cycle to shift the balance or accelerate paydown.
Frequently Asked Questions
What is the average credit card interest rate right now?
The average rate on all credit card accounts at commercial banks was 20.94 percent in the second quarter of 2026, and the average on accounts actually assessed interest was 22.15 percent. Both figures come from the Federal Reserve G.19 release published September 8, 2026. The Fed updates these two rates quarterly, not monthly.
How much interest will I pay on a $10,000 credit card balance?
At the 22.15 percent average rate charged on accounts assessed interest, a $10,000 balance carried for a full year costs about $2,215 in simple interest if the balance never changes, or roughly $185 a month. Because card interest compounds on the daily balance, the real figure runs higher, closer to $2,479 over twelve months. Paying even $100 above the minimum each month cuts that total substantially, because every dollar of principal removed stops accruing immediately.
What is the average APR for a 700 credit score?
The Federal Reserve does not break its published card rates out by credit score, so there is no official government figure for a 700 score specifically. What the G.19 data gives you is the market wide benchmark of 20.94 percent across all accounts. A 700 score sits in the good range, which typically qualifies for offers near or modestly below that average rather than the promotional rates advertised to applicants in the high 700s and above. Issuer pricing also depends on income, utilization and account history.
How much is 26.99 percent APR on a $5,000 credit card balance?
A 26.99 percent APR on $5,000 works out to about $112 in interest in the first month, or roughly $1,350 over a year if the balance is never reduced. That rate is about six percentage points above the 20.94 percent average the Federal Reserve reported for the second quarter of 2026, which puts it in penalty or subprime territory. If your account carries a rate that high, a balance transfer or a fixed rate installment loan is usually worth pricing out.
Is 9.9 percent a good interest rate on a credit card?
Yes. At 9.9 percent you are paying less than half the 20.94 percent average the Federal Reserve reported for all card accounts in the second quarter of 2026, and you are also below the 11.86 percent average on a 24 month personal loan at commercial banks. Rates that low usually come from credit unions, which face a federal cap of 18 percent on most loans, or from a long standing relationship account. Keep it open if the annual fee is reasonable.
Will my credit card rate go up if the Fed raises rates in September?
If you hold a variable rate card and the FOMC raises its target by a quarter point on September 16, then yes. Banks reset the prime rate from 6.75 percent to 7.00 percent within about a day, and your APR increases by the same 25 basis points on your next statement, with no notice required. Fixed rate accounts are different. An issuer must give you 45 days written notice before raising a fixed APR, and you can decline and close the account.
Watching the September 16 Decision
The July consumer credit data is now three weeks stale relative to the FOMC’s information set, and the August Consumer Price Index arrives on September 11, four days before the meeting opens. That inflation print, not this borrowing report, will decide the September vote. What G.19 establishes is the base the decision lands on: a record $1.3572 trillion of card debt priced off a prime rate that has not moved in 272 days. Track the level at current prime rate, the policy path at Fed rate forecast 2026, and the transmission channel at how the Fed affects loans.
References
- Board of Governors of the Federal Reserve System, Consumer Credit G.19, July 2026, released September 8, 2026.
- Board of Governors of the Federal Reserve System, G.19 statistical release, full data tables, September 8, 2026.
- Federal Reserve Bank of St. Louis, Revolving Consumer Credit Owned and Securitized (REVOLSL).
- Federal Reserve Bank of St. Louis, Total Consumer Credit Owned and Securitized (TOTALSL).
- Federal Reserve Bank of St. Louis, Nonrevolving Consumer Credit Owned and Securitized (NONREVSL).
- Federal Reserve Bank of St. Louis, Bank Prime Loan Rate (DPRIME).
- Federal Reserve Bank of St. Louis, Delinquency Rate on Credit Card Loans, All Commercial Banks (DRCCLACBS).
- Board of Governors of the Federal Reserve System, FOMC Meeting Calendars, 2026.
