Banks and Credit Card Companies React to Consumer Debt
As increasing numbers of consumers fail to pay their credit card bill, banks and credit card companies are taking action to protect themselves and reduce future damage, which they are already experiencing.
PricewaterhouseCoopers (PWC) estimates that on average, British adults owe £33,000 each in unsecured loans. Startlingly, this amount has doubled since only 2000.
The inability of consumers to pay their credit card bills has resulted in credit companies losing £4 billion, estimated PWC in its Precious Plastics 2008 report.
In response, credit card companies are rejecting credit applications right and left, and “banks are tightening their credit acceptance policies,” says Richard Thompson, of PWC. Thompson goes on to explain that “Many consumers will find it increasingly difficult to obtain credit in the run-up to Christmas.”