One way banks and credit card issuers are trying to make money—or at least stop losing it—is by getting rid of customers who are bad for business. The number of credit card accounts decreased by 72 million last year.
But what kind of customer is being axed? Some cardholders say they've been blindsided, with their cards canceled without warning—and while they believed they were in good standing. (See the Baltimore Sun story I referenced recently.)
While many accounts are being closed, what might change the most in the credit card landscape is who will be approved for a new account. For some time now, getting a credit card has required about as much time and effort as ordering a pizza. But that is changing, as the banks are taking pains to assess risk and deem who is truly credit worthy. (It's not clear whether the banks' criteria for worthiness will be any more scientific and fact-based than Elaine's "sponge-worthy" determinations in "Seinfeld.")
Higher rates, more annual fees, and fewer credit cards period: This is some of the unfortunate fall-out of credit card reform.
But what kind of customer is being axed? Some cardholders say they've been blindsided, with their cards canceled without warning—and while they believed they were in good standing. (See the Baltimore Sun story I referenced recently.)
While many accounts are being closed, what might change the most in the credit card landscape is who will be approved for a new account. For some time now, getting a credit card has required about as much time and effort as ordering a pizza. But that is changing, as the banks are taking pains to assess risk and deem who is truly credit worthy. (It's not clear whether the banks' criteria for worthiness will be any more scientific and fact-based than Elaine's "sponge-worthy" determinations in "Seinfeld.")
Higher rates, more annual fees, and fewer credit cards period: This is some of the unfortunate fall-out of credit card reform.
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