There have been a number of significant changes in the credit card market since the last quarter of 2008, mainly
Credit Cards
caused by the the credit crunch.
Irresponsible lending has been blamed for causing the credit crunch, so it is understandable that credit card providers have become stricter on who they lend to, tightening acceptance criteria making it harder for some to be approved for credit.
This caused a fall in the acceptance rate, as providers recognised that this previous lending trend needed to be broken as many believed it was this that triggering the financial crisis in the first place.
However, within the last few months the market has seen a rise in competition, which has increased the amount of choice available and in turn led to a growth in consumer appetites for credit cards.
Something else worth noting is that many providers have made these attractive deals available to existing customers only as a way of reducing the risk factor, as this allows the provider to have a pre-existing relationship with the customer, thus enabling them to make a better judgement based on customer profile history.
An existing customer is someone that already holds an account with the provider, such as a savings account or current account.
An example of this is Natwest and RBS, both of which recently increased the balance transfer duration on their Platinum credit cards from 13 months to 15 to all existing customers.
There is nothing stopping you from exposing yourself to the best credit card deals on the market by opening a number of different current accounts spread across multiple banking institutions, as these days most accounts cost you nothing to open with no maintenance costs, so you have nothing to lose in doing so.
According to the British Bankers’ Association, in April, the amount of outstanding credit fell by £412 million to £64.3 billion, £457 million less than the same month last year. The proportion of balances accumulating interest also fell by 0.9 percent to 72.9 percent.
If you have been rejected for a credit card, it is probably due to your credit history not meeting the lenders criteria. It may be worth looking into adverse credit cards, as these are designed to accommodate people that have found it hard to be accepted for a credit card due to a number of reasons.
