[norraad]

Thank you, I've also been told the use of credit cards helps expand money supply.

If so, how and what %?

[Pelham]

“Thank you, I’ve also been told the use of credit cards helps expand money supply. If so, how and what %?”

Well that credit acts like money, so in that fashion it is like any other extension of credit by a bank. As you may know banks extend credit as a multiple of their deposits. The money supply increases when local banks extend loans.

But as to the % I have no idea. It’s surely a much smaller number than the expansion due to loans that banks make against their deposits. It’s probably accounted for in one of the Ms but I don’t know which one.

[Pelham]

This site says credit cards are not counted in the money supply:

http://economics.about.com/cs/money/a/credit_cards.htm