Despite widespread recognition of their importance to an overall loan portfolio, credit cards remain far too mysterious to far too many credit unions, according to consultants that work with credit unions on credit card management.
Too few credit unions have a grasp on such basic concepts as being aware of what makes their card portfolio profitable, how to adequately but not excessively account for risk, how to manage and set credit lines and how to best understand and plan for fraud losses, the executives explained. They added that while none of these faults were sufficient to drive an otherwise healthy portfolio in the red, they were enough to keep them from performing as well as they could.
In order to make credit card portfolios more profitable, the executives agreed, more credit unions need be sure they understand how their card programs make money and to make sure that someone at the executive level has responsibility for overseeing and growing the portfolio.
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