August 11, 2009
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News: Things May be Looking Up
Check your mailbox, there just might be a nice surprise. Major credit card issuers are finally coming around. According to Synovate, credit card interest rate offers to consumers have dropped about 6% from what they were this time last year (from the first to the second quarter of the year). Synovate are the people who track credit card solicitations. It appears that some of the big boys (B of A and CitiBank, for starters) have both increased the number and sweetened their offers. It looks like the cusp has finally turned back toward the positive. Good news in credit cards may finally be on the way.
The spectral shift has not eased up, however, and only those credit card holders in the top echelon are favored (FICO of 700 or higher). You’ll noticed that "fixed rate interest" has still not come back. August 20 is an important date for the other credit card holders. That is when the new CC Reform laws kick in. Some good news is that the volume of offers has finally gotten back to where it was a year ago. Since that time, the volume of mailings (about a billion per quarter a year ago) has fallen by double-digit percentages. By the end of the second quarter last year, the rate of offerings had plummeted to only about a third of that figure.
So now, according to Synovate, B of A has increased it’s mailings by 77% and CitiBank has increased by 65%. These two have raised the bar of competition for the rest to match. Though more conservative than days of old (perhaps a good thing) the credit card industry seems to have recovered enough to start growing again. If these truly are indications of recovery, we may expect competition to set in soon. If that happens, we might see a flurry of offers from the competition as they try to catch up.