Fed Reports Surge in Request for Higher Card Limits as Other Credit Applications Stall

Application rates for increases in credit card limits grew to a series high in the Federal Reserve Bank of New York’s most recent Credit Access Survey.

Making the growth in card limit requests even more notable are the Federal Reserve’s findings that application rates for any other type of credit remained relatively low. The Fed fields its Credit Access Survey every four months.

The data from the October version of the survey provides credit card issuers with information they can use to hit the ground running in the new year with growth strategies that may prove invaluable in a market that’s sending mixed signals.

The survey’s indication that application rates for credit card limits rose while those for other types of credit, including auto loans and mortgages, largely remained stable reveals that many cardholders may prefer to increase their capacity to borrow without resorting to applying for a new credit card.

Numerous sources indicate that it’s far less expensive to retain a current customer than to acquire a new one. In the current credit environment, issuers may be able to save on costs associated with marketing to prospects and instead devote those expenditures to meeting the needs of current cardholders.

Granting requests for higher limits on cards can put issuers in a position to earn higher fees related to cardholder spending.

Higher credit limits can open the door to more revenue for credit card issuers.

And issuers don’t have to wait for customers to get the ball rolling on limit increases. Credit card companies can make use of data models to identify the customers in their portfolio who may spend more should they receive higher limits.

By proactively reaching out to customers to let them know that they now have more purchasing power on their cards, issuers also stand to gain more loyalty from their cardholders. 

The credit card application rates the Federal Reserve disclosed in the October 2025 version of its survey are lower than those in the same report from one year earlier.

A recent study from PYMNTS shows that 42% of consumers don’t think a credit card company would approve their application for a new card, despite the fact that the denial rate of applications for general-purpose credit cards among people who don’t have an active card is only 15%.

But a new study from TransUnion reveals that, among consumers who intend to either apply for a new credit product or refinance an existing one over the next year, 55% plan to complete an application to open a new credit card.

We checked in with Charlie Wise, Senior Vice President and Head of Global Research and Consulting at TransUnion, to learn more about the credit bureau’s study as relates to applications for new cards.

“I’ll be honest, there’s always demand for more credit,” Wise told us. “[Consumers] want that credit card to be able to fund not just holiday spending, but also if their car breaks down or if they have a medical bill to pay. And so, for credit card issuers, they need to be thinking about that demand that is out there.”