Quote of the Month:
"The most popular card for paying for online shopping is the Discover card, according to a survey of consumers' preferences for paying for Internet shopping."
| Forecasts & Statistics |
| Product Trends |
| Industry Trends |
| Issue Archive |
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| On the Brink of a Downturn |
| Despite the best efforts of the Federal Reserve, the economy seems to be teetering on the edge of recession. Five times this year the Fed has lowered its short-term interest rate targets, most recently on May 15th. |
| Bankruptcies Continue to Surge |
| Its beginning to look like the surge in personal bankruptcy filings is a symptom of increasing household financial distress, rather than a one-time acceleration triggered by the pending enactment of reform legislation. In recent months we have been reporting to you the statistics compiled by Visa U.S.A.'s Bankruptcy Notification Service. Now the Administrative Office of the U.S. Courts confirms that personal bankruptcy filings in the first quarter of 2001 experienced the strongest growth in 4 years. |
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| AMEX Blue Card Ownership Soars |
| American Express Co's. Blue Card has experienced the strongest launch of a new card product since the General Motors card rolled out in 1992. After 18 months the product card is in the hands of 5.8 million cardholders according to Brittain Associates (an Atlanta-based card industry consultant). |
| Discover Card Is Tops With Web Shoppers |
| The most popular card for paying for online shopping is the Discover card, according to a survey of consumers' preferences for paying for Internet shopping. Brittain Associates Inc. (an Atlanta-based research and consulting firm) surveyed 3,000 consumers in March of this year and found that Discover had jumped to first place from fourth last year. |
| High Delinquency Rates on Government Cards |
| The U.S. House Subcommittee on Government Efficiency, Financial Management and Intergovernmental Relations has been studying the high delinquency on credit cards held by government employees. CardLine reports that Bank of America, Bank One, Citibank and U.S. Bancorp provided testimony on the problem. |
| Credit Card Fees |
| CardTrak reports that credit card fees have become uniform for the most part among the top ten credit card issuers. The list of the top ten: Citibank, MBNA, First USA, Discover, Chase, Providian, Bank of America, Capital One, Household, and Fleet. The top nine issuers charge a late fee of $29, while Providian charges $35. |
| Discover Offers Affinity Discounts |
| Discover Financial Services has introduced Discover BizPerks, a new affinity discount program targeting at small businesses. The card issuer is a unit of Morgan Stanley Co. |
| Consumer Education |
| The Federal Trade Commission has published a 21-page pamphlet: When Bad Things Happen to Your Good Name. |
| Bits and Pieces |
| Some statistics illuminate consumer attitudes toward financial services and products. • A large portion of American households has computers and uses the Internet for a variety of transactions. Nonetheless, they still prefer using brick-and-mortar banks and shy away from using online services for their financial transactions. |
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| Too Much Consumer Credit? |
| Neither a borrower nor a lender be. Although this admonition was more common a century ago, Americans still seem to have misgivings about debt. Don't cut taxes; pay off the federal debt. Credit cards make it too easy to get into debt. |
| Rising Secondary Mortgage Debt |
| To an increasing extent, data provided by the Federal Reserve on the growth of consumer credit understate the increase in consumers' reliance on credit to finance their assets and expenditures. This is not the fault of the Federal Reserve's statisticians. |
| Reflections on Household/Beneficial Merger |
| In the latest issue of Specialty Lender, E. B. Easter reveals the expectations and outcomes of the merger of Household International Inc. and Beneficial Corp. that was announced in April 1998. The acquisition was completed in June 1999, when Household paid $9.0 billion for Beneficial. |
| Boom Times in Silicon Valley |
| One person's loss may be another's gain. While many technical workers have been losing their jobs, prosperity has struck any one who is a repo-man. |
| The Russians Are Coming! |
| Recall an earlier item in Spotlight about the Russians in England and elsewhere who were evidently involved in stealing credit card numbers. Now, CardLine reports that Alexey Ivanof, 20, and Vasiliy Gorshkov, 25, from Chelyankinsk, Russia, have been arrested by Seattle law enforcement officers. |
| The Canadians Are Coming! |
| The four major Canadian banks have been heading south, each with a somewhat different strategy. In part, the move is a response to the government's denial of two merger proposals involving pairs of the four major banks in 1998. |
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| Court Ruling Sharply Limits Use of Credit-Header Data |
| As of July 1, 2001 credit bureaus will be restricted from selling the consumer identification information at the top of credit reports unless the purchaser has a permissible purpose as defined by the Fair Credit Reporting Act or the consumer has been offered an opportunity to halt the sale. |
| Banks Seek to Halt Class Action Suits |
| In an effort to halt class-action suits, Fleet Boston Financial Corp., as well as Citigroup Inc. and MBNA Corp. are modifying their cardholder agreements to limit or prohibit class- action suits against the bank. |
| Radio Minister & TV Lawyer Charged in Bankruptcy Steering |
| According to Cam Simpson's article in the Chicago Tribune, federal prosecutors have charged the host of a religious radio program with using the business segment of his program to steer listeners to a leading bankruptcy attorney in Chicago. According to the prosecutors, "Christopher A. Claxton received more than $1 million for sending listeners to Erig A. Martin, one of Chicago's most prolific bankruptcy attorneys." |