Chicago (July 29, 2010) – One year after President Obama signed the CARD Act into law, it appears that many potentially negative outcomes of the new regulations did not materialize. In fact, according to Mintel Comperemedia, a service that provides direct marketing competitive intelligence, competition is actually increasing in the credit card industry… and helping keep card offers enticing for American consumers. In Q2 2010, US consumers received nearly 1.1 billion offers for new credit cards, up from just 419 million a year ago. ” it wasn’t long ago that we were speculating about the return of annual fees, the disappearance of teaser rates and the watering down of rewards programs, as card issuers attempted to maintain profits in the face of restrictive new regulations,”notes Andrew Davidson, senior vice president of Mintel Comperemedia. ” as the dust settles on the CARD Act, we continue to see evidence that this isn’t happening. “ One of the biggest fears of the CARD Act was that we would see a return to annual fees. However, fewer offers for new cards now promote a fee than last year. According to Mintel Comperemedia, in Q2 2010, 28% of offers for new cards carried an annual fee, down from 33% a year ago. Another key concern was that teaser rates for balance transfers or purchases would disappear as issuers are now required to apply cardholder payments, above the minimum due, to the highest APR balances first. Again, this didn’t happen and the majority of offers continue to promote teaser rate pricing. In fact, in Q2 2010, 56% of mail offers promoted an introductory APR for both balance transfers and purchases, up from 37% a year ago. “Most balance transfer offers promote a 0% teaser rate and we are now seeing issuers extend the length of the introductory period to 14, 15 and 16 months or more,” adds Andrew Davidson. “However, the longer the length of the introductory period, the more likely it is that the balance transfer fee will be higher with issuers charging 4% or 5% of the check instead of the industry standard of 3%. “ Rewards programs continue to be the norm for the industry, accounting for eight out of 10 offers in Q2 2010. Despite speculation that rewards programs have been watered down, some issuers are promoting 5% cash back offers in certain spend categories while others are awarding cardholders two reward miles per dollar spent. ” if you have a good credit score then some of these offers are loaded with features and benefits ranging from additional discounts online and sweepstakes entry in addition to cash back offers, reward miles and other benefits,”notes Andrew Davidson. While card issuers did navigate the CARD Act by increasing APRs for purchases, we are now beginning to see rates slip. In Q2 2010, the mean APR for variable rate offers declined to 13.79% from 14.21% in the previous quarter, the first quarterly decline since Q1 2009. According to Andrew Davidson, APRs are still higher than they were, but there are signs that increased competition is starting to have a positive effect. Although the CARD Act has not left the industry unscathed, it does appear that it is not restricting the industry as much as was originally thought and consumers are beginning to reap the benefits. About Mintel Comperemedia Mintel Comperemedia provides competitive intelligence for businesses looking to advance and improve their direct marketing strategy. Tracking direct marketing (including mail, email and print advertising) targeted at consumers, small businesses and insurance agents, Mintel Comperemedia offers a unique perspective on everything from banking trends to insurance trends to credit card statistics. For more than 38 years, Mintel has provided insight into key worldwide trends, leading the industry for consumer, product and media intelligence. Follow Mintel on Twitter: http://twitter.com/mintelnews ### You might also be interested in: No related posts.