Credit cards are not considered to be part in the m1 and m2
definition of money. Because the M1 definition of money revolves around money
which are in the hands of the public and written checks, while the M2
definition of money revolves around savings accounts, time deposits of under
$100,000, and balances in retail money market mutual funds. Which also includes
the M1 in the M2. While, the M3 definition of money refers to the balances in
institutional money funds, repurchase accountabilities dispensed by depository establishments,
and the Eurodollar. It also includes M1 and M2. Credit cards are not considered
to be in M1 and M2 definitions of money, since credit cards becomes part of the
money transaction only, during the payment of your credit card bill.
