Credit card use declining – other options are... - Other News

ADVERTISING DISCLOSURE

ADVERTISING DISCLOSURE:
Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from most credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » News » Other » Credit card use declining – other options are in

Credit card use declining – other options are in

Credit card use declining – other options are in
The content is accurate at the time of publication and is subject to change.

There are at least 8 million people who are free of credit cards. According to reports by CNN, there is a drastic decline in credit card usage and the numbers are steadily increasing. The figures have gone up from 70 million to 78 million this year. With the recession last year when every penny mattered, many cardholders disposed their credit cards in a bid to cut down on expenses and reduce debts. This was a move to avoid the hike in fees too. As per reports, TransUnion was quoted as saying that the average credit card debt went down further by 11% in the last year alone. This was an unprecedented phenomenon. However, there were claims that consumers would never abandon their credit cards. But as per the present trend, consumers were moving away from the risk of debts and were creating more wealth through savings.


Most of the present trend is due to the charge offs in the high-risk segments. This was a direct fallout of the new card act regulations, which put restrictions on credit card companies and the hike in interest rates. As a result of this, the accounts of consumers who were considered “dead weight” by the issuers were written-off. Due to the rising defaults in debts during the recession, companies decided remove these risky accounts. Hence, both parties were getting out of risk with this move.


Some smart consumers saw an opportunity in this also by creating other new products to increase their wealth through savings. Recently, the Kardashian sisters launched a prepaid credit card which has now been canceled due to the exorbitant fees. The General Attorney took note of this, and pulled up the credit card companies for bad financial practices. This in turn saw a chain reaction, with the Kardashian sisters pulling out and canceling the credit card.


The future trend seems to be a rise in prepaid credit cards, which is expected to go up in 2013 by an astonishing $672 billion. Young adults seem to have developed a general distaste for credit cards, especially with the recent flop of the Kardashian card. These credit cards don`t even have the protections of the other regular banking products.


Hence, the bottom line is that investment and savings are going up, while there is a general decline in credit card usage. The switch over to prepaid credit cards is apparent. However, one has to wait and watch as to how things will unfold in the coming year.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
Add to Favorites:

Related News:

New CENTURION Lounges in London and Charlotte

Posted: December 7, 2018

Travelers who pass through Heathrow airport when heading to London and Charlotte Douglas International Airport in North Carolina may well be happy to learn that American Express is opening new Centurion Lounges in both these airports. ... Continue reading
Mastercard Sets up Shop

Posted: December 6, 2018

MasterCard is rolling out their own online store, offering visitors a 3D platform, where they can shop just like they would in a brick and mortar store, using virtual technology. This way they can get the feel of real-time shopping while ... Continue reading
Data Breach at Marriott Affects 500 Million Starwood Guests

Posted: December 5, 2018

If you have stayed at a Starwood hotel you might want to keep an eye on your credit report because Marriot has announced that the Starwood guest reservation system was breached. Reportedly, this hack may have compromised the personal ... Continue reading
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.
Earn 5% cash back at different places each quarter like gas stations, grocery stores, restaurants, Amazon.com and more up to the quarterly maximum, each time you activate.
For Excellent, Good Credit
INTRO OFFER: Discover will match ALL the Miles you've earned at the end of your first year, automatically. For example, if you earn 30,000 Miles, you get 60,000 Miles. That's $600 towards travel!
For Excellent, Good Credit
Earn 2% cash back on purchases: 1% when you buy plus 1% as you pay
For Excellent, Good Credit
You've successfully subscribed!

Please specify the following:All these fields are optional

Your Credit History
Themes you are interested in:

By providing this information you help us make our news letters more useful and informative. Thank you!