Credit Risk Falls For Fifth Consecutive Quarter

Consumers may be finally getting their credit card debt under control, as a recent study reported that poor financial habits have declined dramatically.

The Credit Risk Index, completed by TransUnion, stood at 123.56 at the end of the first quarter of 2011. This was the fifth straight quarter the number has fallen, showing consumers may be getting more careful with their finances.

In the fourth quarter of 2010, the Index stood at 125.61, 5 percent higher than the current figure.

"In less than four years, the percentage of consumers with at least one general purpose bank issued credit card has dropped from its peak of nearly 75 percent to just below 66 percent, a level not seen since early 1998, with all indicators pointing to lower levels in the quarters to come," said Chet Wiermanski, TransUnion's global chief scientist. "Conversely, the use of installment loans from banks, credit unions and finance companies, which historically exhibit lower level of delinquency, has remained relatively stable for nearly 20 years."

Wiermanski added that those with plastic are beginning to use credit more responsibly, and with the continuing improvement of the economy, the Index should continue to fall over the next couple years.