Credit Card Risk, Protracted Pandemic, and the Household Budget: Advice for Issuers
- Date:December 23, 2021
- Author(s):
- Brian Riley
- Research Topic(s):
- Credit
- PAID CONTENT
Overview
Credit card issuers must prepare for another COVID wave.
Mercator Advisory Group released a report covering the credit card issuer risks in a world of COVID variants, titled Credit Card Risk, Protracted Pandemic, and the Household Budget: Advice for Issuers. The research explains current credit card risk and the impact on household budgets as inflation grows, interest rates increase, and the workplace continues to be disrupted.
The research explains why the latest COVID variation may affect consumers and their spending habits differently than it did in 2020.
"The economic relief programs offered by the U.S. and many other countries might be impossible if the pandemic rebounds,” comments Brian Riley, Director, Credit Advisory, at Mercator Advisory Group, and the author of the research note. Riley continues: “Credit card issuers must keep a keen eye on the impact of inflation, rising interest rates, and employment. Issuers underwrite with higher spreads than ever, but the interest opportunity may not be sufficient if credit losses shift.”
This document contains 20 pages and 10 exhibits.
Companies mentioned in this research note include: American Express, Capital One, Chase, Citi, FICO, FIS, Fiserv, Mastercard, TSYS, Visa.
One of the exhibits included in this report:
- Explanation of current issues surrounding revolving debt
- Illustration of rising consumer interest rates while the prime rate sits at 2%
- Discussion of new credit card accounts and delinquency rates
- Review of the household budget and the capacity to repay as interest and inflation rise
- An action plan for credit managers
Learn More About This Report & Javelin
Related content
From Hype to Impact: How AI is Transforming Credit
Advances in artificial intelligence have generated a high level of excitement and marketing spending as financial organizations seek to rebrand their technologies with “AI” and dev...
Amex and Chase Face Off on Premium Credit Cards, but the Backstory Is More Interesting
Moves by American Express and Chase to revamp their signature card reward products will bring the issuers into greater competition for the most affluent cardholders and carry rever...
How Will Agentic Commerce Affect Consumer Credit?
Recent product announcements from leaders in the payments industry demonstrate the excitement surrounding new AI technologies. AI isn’t just a buzzword anymore, and AI-powered pers...
Make informed decisions in a digital financial world