New Credit Card Bill Leads to Fewer Credit Card Offers
The new credit card laws which took effect earlier this year focused on how companies treated customers they are also affecting how these companies acquire customers.
Consumer Reports has the words straight from the horse’s mouth in the form of a recent letter to shareholders from Chase CEO Jamie Dimon.
Chase is perhaps the biggest credit card kid on the block. According to the most recent numbers from a Nilsson Report, Chase has more cards issued in circulation and more charges on its cardholder accounts than any other company.
In 2008, Chase has almost 120 million credit cards in circulation. The second largest company, Citi, had only 92 million. Chase also had $167 billion in outstanding balances on its cards as of June, 2009.
In his latest memo to his shareholders, Dimon outlines some of the changes in the credit card business that are facing the company.
He mentioned that Chase will be offering credit cards to fewer customers. Chase is trimming its list of offers by 15 percent because these customers are deemed “too risky.”
He doesn’t elaborate on what “too risky” means, and we’ve seen in the past how credit companies will sometimes cut available credit for users with a good track record. But if you’ve noticed fewer credit card offers in the mail, this may be the cause.
Or, you may have been one of the people who had their credit lines reduced or cut completely. This was another tactic he said Chase employed as they adjusted to the new rules stemming from the credit card bill passed last year.
The new regulations don’t seem to be hurting business too much, as just this week Chase announced that in 2009 their revenue was a record $100 billion.