Consumer Group Slams Credit Card Marketers

Share this article:
A consumer group accused credit card marketers of greatly increasing the credit they offer to consumers while at the same time supporting new bankruptcy legislation that would make it harder for consumers to declare bankruptcy.


"Can any of [the credit card issuers] explain why they need [the bankruptcy] relief when their profits are increasing and they are trying to sell many more cards and offering cardholders far more credit?" Travis Plunkett, legislative director of the Consumer Federation of America, said at a news conference yesterday in Washington. "What's worse, erecting new bankruptcy barriers will encourage issuers to market and extend credit even more aggressively."


The CFA said that recent data show that credit card issuers dramatically expanded their marketing and available credit in the past year. Issuers also kept credit card interest rates up while the cost of loaning money plummeted, boosting profit by more than 50 percent over five years ago, the group said.


In the 12 months ending March 31, 2002, credit card issuers mailed 5 billion solicitations and offered more than $3 trillion of unused credit -- $30,000 per household, the CFA said.


But consumers are increasingly rejecting these solicitations and refusing to draw on the expanding credit lines, the group said. The CFA cited Federal Reserve Board data here, showing that revolving consumer credit, almost entirely credit card debt, declined $29 billion in the first three months of 2002.


Share this article:
You must be a registered member of Direct Marketing News to post a comment.
close

Next Article in Data/Analytics

Sign up to our newsletters

Follow us on Twitter @dmnews

Latest Jobs:

Featured Listings

More in Data/Analytics

Acxiom East?

Acxiom East?

Ogilvy & Mather launches OgilvyAmp, a think tank for data-driven marketers headed by expatriates from Little Rock's best-known data company.

Epicor to Acquire Analytics Provider QuantiSense

Epicor to Acquire Analytics Provider QuantiSense

Retail solutions provider seeks to up its data analytics game for large and midsized retailers.

One Third of Companies Fail to Measure Data Quality ROI

One Third of Companies Fail to Measure Data ...

Twenty percent of companies assume their data quality tools pay off, while another 10% doesn't monitor ROI at all.