EconomyRevenge of the Debit CardWhat's going on: Americans have officially entered their “it’s not you, it’s interest rates” era. As they grow more debt-averse and anxious about the economy, the humble debit card is having its comeback moment. Credit card balances hit $1.2 trillion earlier in 2025, according to the New York Fed. The surge has left many consumers wary, with average interest rates sitting at — and in some cases exceeding — a historic 21%. That helps explain why debit use is exploding in popularity, with a 2022 S&P Global survey finding most people prefer it. Part of this growth is marketing. From Venmo to the BNPL provider Klarna, everyone’s tried to get in on the debit card boom (banks make money when funds are parked in checking, so it’s no wonder). They’ve hired celebs like Aimee Lou Wood and Travis Kelce to try to make debit look “cool” (well, cool for a piece of plastic that says you can’t afford Ariana Grande tickets). What it means: Fear has fueled this shift, along with broader concerns about the economy, ads, and cultural factors. Especially with student loans weighing folks down, many — particularly the younger generation — have a “growing fear” of credit cards. Debit card usage is one way to take back control, experts say (it’s also more functional than a piggy bank). On the one hand, debit cards, which went mainstream in the 1990s, offer an alternative to having to pay interest, overdraft fees be damned. On the other hand, they can come with their own set of risks, including fewer protections if you’re the victim of fraud. Related: The Gender Pay Gap Is Widening — Progress, We Hardly Knew You (Axios) |