With all the talk of reform and banking woes, you might be wondering if the credit card industry is really in trouble. While industry insiders would like you to believe that credit card reform is the death-knell of their business, the truth is that the industry will live on.
A recent study from Keefe, Bruyette and Woods suggests that credit cards will continue to be a primary source of bank revenue even after the new laws go into effect. And there's more reform on the horizon; Congress is deciding what to do about interchange fees, those fees that merchants have to pay for the ability to accept credit card payments.
The study's analysts believe that interchange fee reform will affect Capital One, American Express, and Discover more harshly than Visa and MasterCard. The latter two companies will be more affected by interest rate reform, but experts predict that all of the primary card issuers will survive the meltdown.
Credit card stocks are on the rise again, a hopeful sign that the economy is clawing its way out of the grave. This is a great opportunity for new card holders to learn from the mistakes of their predecessors.
No comments:
Post a Comment