CardInform Blog

So, with the financial crisis in full swing (debatably with some “green shoots”) many people are now becoming more and more wary of taking on too much personal credit.  As a result banks have seen a noticeable increase in debit card transaction volume.  There are definitely advantages for consumers to switch to debit cards, the main one being that it requires less personal credit management since debit cards tap into one’s existing savings or checking balance and uses money that one also possess right?  WRONG!

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Though we might be taking a beating from the economy downturn, we can at least be thankful that in such dismal times, the government can push through such consumer friendly regulation such as this!

Some of the things we can expect:

• No more double cycling (paying interest on retro-active debt)
• At least 21 days  of billing period
• Cannot raise rates on existing balances
• Payment applied to the portion with highest interest

The only drawback?  It’s only slated to come as of January 2010.  We can’t win ‘em all but this is a good start!

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If you, like me, have seen a drastic decline in credit offers then you must be wondering how Americans can continue fueling their spending and close to 0% savings rate.  Historically, personal consumer credit has been a hallmark of the Amaerican economy and we were “privileged” enough to be able to afford house 10 times our income with $0 in equity.

This weekend, the NYTimes also has a feature on credit card debt highlighting the importance of credit card spending and the return of the layaway…if you’re old enough to remember what that means.

The street seems to be worried about default losses on consumer credit cards increasing as the trickle down effect from mortgages spreads.  However, by limited credit approvals and eliminating balance transfer offers, banks are actually going to expedite the impact of credit default losses. Read the rest of this entry »

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Well, thanks to the beautiful birth of the credit card, people in the US have been in personal credit debt for 50 years now!

The WSJ created a little video outlining how this wonderful invention that can spur consumer spending has created $2.5 Trillion in debt with 640 million card in issuance, which as you can calculate is over 2 cards per person (yes, even babies use credit cards).

 Watch the WSJ video here.

…and many more…

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