Credit Card Originations Cool After Summer Surge as Banks Tighten Lending

Credit card originations in the U.S. are slowing down in the wake of a summer that saw increases in card openings, according to a new report from VantageScore that analyzes the overall health of consumer credit in the country.

The recent decline in originations following a boost over the summer could be due to a softening demand among consumers for new credit cards. But it may also be indicative of issuers tightening their standards for lending. VantageScore is betting on the latter.

“Banks are reining in new lending, suggesting that banks are taking a more cautious posture after a strong summer and leading to originations softening across most credit products,” Susan Fahy, Executive Vice President and Chief Digital Officer for VantageScore, said in the report.

The new VantageScore report highlights that originations for auto loans, mortgages, and other personal loans also dipped in September after ramping up in the summer.  

The report also reveals that overall credit delinquencies are trending up, with delinquencies in their early stages hitting a year-to-date high. 

“Early-stage delinquencies are near levels last seen before the COVID pandemic,” Fahy noted.

Credit card issuers will want to keep a close eye on their card portfolios because issuers may need to adjust reserves for losses or make changes to their policies around credit limits and interest rates should delinquencies continue to rise.

Although delinquencies are increasing on credit products in the U.S., rates for net charge-offs on credit cards fell in September, according to a report from Seeking Alpha.

A decline in charge-off rates is a positive for credit card issuers, but jumps in delinquencies, coupled with economic factors, suggest that issuers may want to prepare for elevated charge-off rates in the future.

The government shutdown is affecting some segments of workers in the U.S. that either directly or indirectly rely on an open government for their livelihood. And the labor market is showing signs of stress as prominent companies such as Amazon and UPS have laid off thousands of workers before the holiday shopping season kicks into high gear.

But news concerning the state of the credit card industry isn’t all doom and gloom lately. A new report from the Wall Street Journal shows that credit card spending on leading issuers’ cards grew during the third quarter. 

The average consumer credit score in the U.S. was 701 in September, according to VantageScore.

“The U.S. consumer and the overall macro economy have been quite resilient so far in 2025,” Richard Fairbank, Chief Executive Officer of Capital One, said during a recent earnings call, according to the Journal. “But I do think we’re in a period of elevated economic uncertainty.”

And VantageScore’s report indicates that the average credit score in the U.S. has stayed steady, coming in at 701 for September.

A slowdown in originations may impact portfolio growth for some issuers. But those that can capitalize on strong spending from their current cardholders, which stands to ramp up as the holidays approach, may be able to weather setbacks until originations pick back up again.