Economic Thaw Leads to Increased Use of Credit, Expanding Payments Programs

Credit an uptick in the economy with a steady increase in card usage. Many consumers seem ready to ramp up spending and reach for their credit cards. For financial institutions ready to expand payments programs – and put historically high credit loss levels and declining portfolio profitability in the rearview mirror – this is all good news.

Consumers want credit alternatives, and banks and credit unions are looking for ways to boost revenue and deepen client relationships. Rarely have consumers' wants and financial institutions' needs been so tightly aligned.

As ongoing regulation continues to impact traditional non-interest income streams, credit cards provide a more stable source of income. Just as promising is the opportunity to expand and deepen relationships, as cardholders typically bring more deposit and loan services to their card-issuing institution than non-cardholders.

Credit Card Strategies and Opportunities, a new study from the Raddon Financial Group at Fiserv, outlines the competitive and crowded card business in the U.S. To compete with the mega card issuers in this environment, small and mid-size issuers must tailor their card offerings and marketing efforts to meet consumers' individual needs. Consumers value choice, which may mean a strong, varied rewards program, a lower interest rate or an opportunity to transfer balances.

By recognizing the different behavior patterns of credit card users – and designing and marketing products accordingly – financial institutions can differentiate themselves in this competitive market. With the recent growth in credit card transactions and balances, now is the time for financial institutions to secure market share. In this Boardroom Series session, Vikas Bansal, vice president and credit product leader, Card Services, Fiserv, discusses how credit card payments can position financial institutions as a one-stop source for card payment choices.

The Fiserv Boardroom Series is the exclusive, online thought leadership community for Fiserv clients. If you are a Fiserv client and would like to join Boardroom Series, email

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