Credit Card Base

When it comes to credit card issuers it doesn’t seem that everything is “doom and gloom” in 2010 as it was first projected. Instead issuers are now seeing some silver lining that could ultimately place them well above what they are expecting for this year. While a lot has to do with an increase in consumer spending, it is much more as recent numbers show issuers are for the most part “a step ahead”.

So what was the silver lining that many issuers saw? In a nutshell, it was the first quarter earnings reported by many issuers. While for some the numbers released weren’t what they were looking for, they still were much better than expected considering the sheer amount of delinquency and write-offs that occurred in prior months. Now as the economic environment seems to somewhat stabilizing (especially unemployment) many issuers believe that numbers will only increase as more consumers start to spend more. For this year we have already seen consumer spending increase in retail sells. While many purchases were without plastic (exception of debit cards), this is expected to change as cardholders become more comfortable with all of the recent changes because of the implementation of the CARD Act.

When it comes to consumers using their credit cards more to make purchases, it is not something that is unfathomable given American history with plastic. Although there are probably more that will admit it, consumers for the most part have always have a love / hate relationship with their cards, and while at the moment many are in the hate phase it is expected to pass. As consumers continue to spend more month after month, it is only a matter of time before credit cards are used to make more than just a few purchases.

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