Analysis suggests Act hikes card issuing risks and keeps rates high.
BOCA RATON, Fla. — Too many credit union credit card programs suffer from having no dedicated manager or champion, THINK attendees told.
Industry observers and executives with other processing companies predict that the recent supervisory letter on FIS security problems may have a limited impact on FIS’ sales but will likely heighten the importance of security for all payments processors.
Long, complicate processor switch process should impede exodus from FIS after regulatory letter, card consultant says.
Somewhat counterintuitively, CU card industry experts say that two conflicting trends in the economy make 2012 a good year for a credit union that had foregone credit card issuing in the past to get back into the business.
Bank of America made official last week what many anticipated when a spokesperson acknowledged that it will no longer issue credit cards in agent relationships with credit unions and smaller banks.
An analysis of call report data indicates that only two more credit unions recently sold their credit card portfolios and entered into an agent issuing program with the purchasing banks, a brokerage says.
The market for credit union credit card portfolios has slowed down.
Many credit unions that sold their credit card portfolios in 2006 and 2007 and entered into agent issuing agreements should start actively considering those agreements in 2011 and 12, according to CU card consultants.
Credit union card portfolios continued the improved performance they have demonstrated in the last several years in 2009, and the card portfolio sales continued their slow pace as the volumes of card assets that changed hands rose a bit.