Credit Card Offers Again on the Rise
They’re back. After a short recess during the darkest days of the recession, credit card offers are starting to multiply like rabbits in U.S. mailboxes. Banks, department stores, specialty stores, and many others —. Even grocery stores now have their cashiers peddling branded credit cards as they bag your milk . As America struggles back to work and wary consumers slowly start spending again, it seems like these greedy banks want to put people back in a hole.
Last quarter, credit card companies mailed offers to 1 billion consumers, more than double the number of offers mailed during the same quarter last year, according to Mitel Comperemedia which tracks direct mail offers. The credit card industry is predicted to mail out 3 to 4 billion credit offers this year, which is double last year’s two billion.
Back in 2006 and 2007 banks and consumer finance companies were practically handing out credit cards like candy at a every major event, giving away T shirts, huggies, and other promotional items just for signing up. Today things are different. New consumer protection laws enacted under the 2009 Card Accountability, Responsibility and Disclosure (CARD) Act are forcing banks to be more judicious in extending credit to consumers. Consumers applying for credit cards will have to meet much higher standards than ever before. Students must now be 21 to qualify for a credit card or be able to demonstrate their ability to meet monthly payments.
Credit card offers always read like you’ve been personally selected for a great honor. In congratulatory tones, they make it sound like you’ve won a sweepstakes prize, like they’re doing you a marvelous favor. Banks use low interest rates, bonus miles, bonus points and other gimmicks to lure customers into applying for credit cards. And while judiciously used credit can be a useful financial tool, consumers should remember that banks aren’t really offering you a credit card to help you out. They’re in it for the money.
Credit cards are a huge cash cow for banks, pulling in billions of dollars every year in fees and interest charges. U.S. consumer credit card debt now stands at $852.6 billion, an average $15,788 per household. At the rate banks are flooding mailboxes with credit card offers, those figures are sure to rise
Jeremy,
You’re right. I have received 4 in the last 30 days after having not received any over the last year or so. I will say that I read them to take a look at how the credit card companies are now disclosing their terms and there seems to be some improvement in disclosure on the ones I received based on the new act…But, consumers still must READ them.