A recent report suggested increased stability in the credit card industry, demonstrated in part by improved customer confidence in this sector. J.D. Power and Associates released its report at the end of August, providing food for thought for lenders that desire better profitability from their credit products.
The report’s index tracks customer satisfaction on a 1000-point scale, taking into consideration factors such as billing and payment processes, card benefits and services and the ability of the creditor to resolve problems. According to the results, satisfaction averages 753 this year, an increase from 731 last year and 714 in 2010.
Experts with the group said it was most likely that consumers had grown comfortable with their existing fees, credit card terms and limits, which have not changed much in recent years. That has yielded stability, which has improved consumer confidence in the wake national financial volatility.
In addition, 84 percent of consumers reported satisfaction with the way credit card companies resolved their issues.
“Although credit card companies have been criticized for some of their business practices, when we look at overall customer satisfaction, they’re doing a good job,” said Jim Miller, an executive at J.D. Power and Associates.
Improved stability and customer satisfaction could provide a significant opportunity to lenders that wish to grow credit card portfolios. Industry analysts also point to improving factors in the private label credit card market, which has improved the profitability of credit card operations within major retailers.
To maximize these opportunities, traditional and private-label credit card providers must rely on a sophisticated credit application processing framework that offers intuitive automated decisioning capabilities and tools for building credit scorecards and applicant evaluation systems.
