(NewsNation) — Americans paid $105 billion in credit card interest in 2022 as inflation and rising interest rates continue to put financial pressure on Americans, according to a new report by the Consumer Financial Protection Bureau.
“One in three Americans have credit card debt, and one in 10 credit cards is in persistent debt. So that means that even though you’re making that minimum payment every month, a year from now, you likely will have more interest payments to make that you get today,” said business contributor Lydia Moynihan.
Moynihan joined “NewsNation Prime” to discuss rising credit card debt, saying Americans are paying well over 20% in interest rates.
CFPB’s data showed credit card debt surpassed $1 trillion for the first time and annual spending on credit cards increased to $3.2 trillion.
The report also found one in three cardholders with the lowest credit scores, subprime and deep subprime, were in persistent debt last year. This is up from 2021 which was around 25% and approaching pro-pandemic levels.
CFPB officials say the number of Americans stuck in a debt loop will only increase in 2023.
Moynihan says one of the ways to escape the loop is by opening another balance transfer card.
“You can transfer the super high interest rate that you’re paying to another card, you can also get a personal loan as well,” Moynihan said.