Consumer Confidence Up as Banks Offer New Credit Cards
With the economy growing stronger each day, financial institutions are becoming more willing to expand their services in an effort to increase their customer base. Consumer confidence is growing and credit cards are not as intimidating of an option for spending money as before.
Wells Fargo is one organization that is taking notice, and it recently announced that it will begin a stronger push in offering credit cards to its clients. As reported in the Wall Street Journal, the San Francisco-based bank is going to make a significant push in the second half of this year
CEO John Stumpf told the news source last week that so far in 2013, 35 percent of Wells Fargo customers have a card with the bank, while last year that number was 31 percent.
Chief Financial Officer Timothy Sloan explained to the news source that offering credit cards could also help Wells Fargo create new banking relationships.
“As we broaden our product line and have a better rewards program, that may mean customers might come to Wells Fargo because they like the credit card,” Sloan said, adding “that doesn’t mean we want to create a monoline, one-product credit card business.”
The Journal reported that Wells Fargo officials know that many current customers already have a credit card, but the goal is to entice them to switch to theirs and then use it on a regular basis. One way the bank plans to do this is offer rewards that link customer accounts to their home mortgage or similar loans.
Should other financial institutions opt to take a similar path, it is important that they have the right credit application software. Even if clients already have a home loan, banks must still ensure that they are making quality investments and credit risk is minimized.