With more American consumers proving that they can remain on top of their finances, banks are beginning to take notice. While financial institutions might want to increase their customer base, it is still essential to bring on borrowers who can make timely payments and have strong credit histories. Implementing strong credit scoring software will help organizations make the right investments, even as other options become more mainstream.
One choice that is becoming more popular among some banks is offering customers no-interest transfers. The Wall Street Journal highlighted this recent trend, explaining that zero percent balance transfers—allowing a customer to transfer existing card balances—are now being offered to a wider array of shoppers. Even credit unions are taking note and are expanding their offers, yet all organizations say that a strong credit history is still required.
“We view competitive balance-transfer offers as one potential way for acquiring new customers, similar to the way we view bonus-point offers on reward cards…. We believe customers who try our products will like them and will want to remain long-term customers,” Paul Hartwick, a spokesman for J.P. Morgan’s card business, explained to the news source.
Randy Hopper, assistant vice president of credit-card lending at Navy Federal agreed, telling the Journal that zero balance transfers are good offers for customers who already have a mortgage or car loan. According to Hopper, a credit card is a “relationship product,” which is why his company wants each consumer to have one.
For any new account opening, banks should ensure that the potential borrower is creditworthy. Regardless of whether an organization is offering zero balance transfers or something else, the right credit scoring software will keep the process as smooth as possible.