Credit Card Capsules

• Complaints to the regulators: The Federal Deposit Insurance Corp regulates 17 state-chartered credit card banks. According to Cardline, it received 3,118 complaints and inquiries by mail last year and 2,500 by phone. This year, consumer contacts are running ahead of last year's pace. The FDIC report evidently does not provide data on the percentage of cardholders making complaints vs. inquiries.

• Privacy responses on credit cards: Have you responded to the notice from your credit card issuer to exercise your opt-out rights regarding handling of your personal information? If you have, you don't have much company. According to a report from TowerGroup, only about 4 percent of consumers have responded to the notices which financial institutions have been sending out in compliance with the financial privacy provisions of the Gramm-Leach-Blilely Financial Modernization Act. CardLine points out, many of the disclosure documents have been in small type. Further, all but one of the choices typically allowed the card issuer to make some use of the respondent's information. Most of the responses thus far have been by telephone.

• Prepaid gift cards on the rise: A new survey shows that U.S. customers are purchasing prepaid cards at retailers with much greater frequency. In a poll of 1,000 consumers, 45 percent indicated they had purchased a prepaid gift card in the past year, up from just 11 percent in a similar survey one year ago. Robert Brolsma, an executive with Standard Register (a company which manages prepaid card product lines) told the American Banker that the surge in usage was "quite surprising" but probably attributable to the launch of gift card programs during the past year at large national retailers such as Home Depot, Wal-Mart Stores and Kmart. The average annual gift card purchase was approximately $200, up from $139 a year earlier. Once viewed strictly as a gift item, the prepaid cards are increasingly being used as spending cards, especially for college students or children at home. Forty-four of the top 50 retailers offer at least one type of prepaid card.

• Canadian card solicitations: Three U.S. monoline card issuers, Capital One, MBNA and Providian, have been filling Canadian households' mailboxes with card solicitations, accounting for 74 percent of the 45.8 million mailings north of the border during the first quarter, 2001. However, issuers haven't fared much better in Canada at garnering new accounts: response rates were just 0.9 percent on first quarter Canadian mailings, compared to 0.6 percent on U.S. mailings. Canadian households still receive fewer direct mail solicitations than their U.S. counterparts. U.S. households receive an average 4.7 per month during the fourth quarter last year, about twice as many as the Canadian average.