Credit Expected to Increase as Well as Risk - Other News


ADVERTISING DISCLOSURE: is an independent, advertising-supported web site. 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. has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » News » Other » Credit Expected to Increase as Well as Risk

Credit Expected to Increase as Well as Risk

Credit Expected to Increase as Well as Risk
The content is accurate at the time of publication and is subject to change.

Risk managers at North American banks foresee a greater demand for credit leading to increased balances, and increased risk for credit issuers.

In FICO’s quarterly survey of the Professional Risk Managers’ International Association (PRMIA), 44% of managers surveyed redicted an increase in credit card delinquencies over the next six months. If that happens, it could push total consumer loan delinquencies to the highest they’ve been since the final quarter of 2011.

Sixty-five percent of those polled see balances on credit cards increasing in the next six months. In the four years that FICO and PRMIA have conducted this study that is the highest percentage of risk managers who said balances would increase.

They also predict more people will apply for new lines of credit. Sixty-one percent of risk managers said in the next six months we’ll see an increase in the amount of new credit line requests by consumers.

Delinquencies not necessarily bad news

The increase in requests for credit, along with more delinquencies, is not necessarily bad news for the economy. When the economy is in recession, lenders are less likely to extend credit to high-risk borrowers, according to FICO. Now that banks are loosening up their standards and giving credit more freely, delinquencies can be expected to rise.

Small business credit holds steady

When it comes to small business owners managing credit, risk managers don’t expect significant changes in the near future.

When asked how the amount of credit requested by small businesses would evolve over the next six months, 94% of risk managers believed it would either remain steady or increase. Eighty-four percent said the amount of credit actually extended to small businesses would also be steady, or possibly increase. Seventy-four percent expected the amount to meet demand.

The complete survey results an be found here. It was conducted in February 2014 and included responses from 229 bank risk managers.

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:

More Smartphone Banking Apps Wanted
More Smartphone Banking Apps Wanted

Posted: January 15, 2014

Consumers are looking to get more out of their smartphones when it comes to managing their money and credit cards, according to a new international FICO study. Continue reading

Survey Reveals Common Money Misconceptions
Survey Reveals Common Money Misconceptions

Posted: April 23, 2014

People think they know more about money than they actually do, according to a new survey highlighting common money myths and attitudes about finances. Continue reading

Detroit Least Debt-Riddled City, Says Experian Study
Detroit Least Debt-Riddled City, Says Experian Study

Posted: May 14, 2014

In a study of the 20 largest major metropolitan areas in the United States, Detroit residents had the lowest average amount of consumer debt: $23,604. Over the last four years, average debt in the economically challenged Michigan city has… 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, 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 unlimited 1.5% cash back on every purchase, every day
For Average, Fair, Limited 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!