Credit Card Industry Facts
Americans owe approximately $850 dollars in revolving credit card debt as of May of 2009, according to the Consumers Union. One study revealed that at least 84 percent of undergraduates had at least one credit card, according to Creditcardreform.com. Credit cards have led to major financial problems for individuals in the United States. Regulations protect consumers from high interest rates and deceptive practices of major credit card companies.
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Quantity
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Approximately 1.5 billion credit cards are in use in the United States, according to Consumercreditguide.com. This averages out to approximately 8 credit cards per person.
Warning
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Americans pay approximately $20 billion in credit card fees each year, according to Consumercreditguide.com. The universal default clause allows credit card companies to raise interest fees even after a single late payment, according to Bankrate.com.
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Considerations
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In 2007 approximately $5 trillion worth of credit was made available by companies, according to Consumercreditguide.com. This averages out to $47,007 per American household. Over 4.2 billion credit card offers were sent in the mail in 2008. This is four times as many credit card offers that were sent in 1990.
Banks that specialize in credit cards are much more successful than banks in general. The return on investment is 15.1 percent for credit cards in general and 8.2 percent for banks.
The average debt on a credit card for undergraduates in 2007 was $3,173, according to Consumercreditguide.com. The average undergraduate senior graduated with $4,100 in debt in 2007. Almost one third of college students put tuition on their credit card in 2008.
Quick Fact
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The major companies that dominate the credit card industry are Bank of America, JP Morgan, Chase, Citigroup, Capital One, Discover and American Express, according to Consumercreditguide.com. These companies account for 90 percent of all credit card debt.
Profit
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The credit card industry as a whole made a total profit of $18 billion in 2006, according to Consumercreditguide.com.
Outlook
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All of the 12 major credit card issuers were found to breach the Federal Reserve Rule of 2010, according to Consumercreditguide.com. These breaches include binding arbitration agreements, fees for exceeding a credit limit and low promotional rates that are revoked.
Potential
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Over 84 percent of undergraduates in 2008 admitted that they needed more education in financial management, according to Consumercreditguide.com.
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References
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