Big changes to the CREDITCARD industry

The recession had a immense effect on the credit card industry, which has caused billions of dollars in losses with a huge increase in the number of people who can’t pay their bills because of a sudden job loss or other money crisis. That causes another ripple effect even on a large group of credit card customers who have always paid their bills on time.

Bill Hardekopf(chief executive officer of lowcards.com) has added “The game has changed dramatically. If you do anything — and I mean anything — to show that you’re a higher financial risk right now, you will, the next month, get an increase in your (annual percentage rate) or a decrease in your credit limit.”

In the period from 2007 - 2008, credit card service providers increases their interest rates on nearly 1/3 of all their existing cardholder accounts- according to the Pew Safe Credit Cards Project, which collects data the banks provided about new credit card regulations.

Within the first three months, the rate of interest for bank-issued credit cards increased to 1.32 percent, from 1.19 percent a year ago-added TransUnion,from 27 million-credit card transaction database.

A new set of regulations, known as the Credit Card Bill of Rights, will get into effect from next year , which will make a number of changes particularly protecting customers from sudden unexpected deductions, and risinge interest rates without proper notification.

The techniques credit card providers using to compute risk depends upon various things, but experts say a minor change of your payment-pattern can be causing a sudden increase of interest rates, or decrease in your creditlimit . Only making the minimum payments can also be a red flag to credit card companies .Using your credit card to buy second-hand commodities or for gambling/betting can also be harmful for your credit score.so think wisely, do well.

Lifestyle vs Credit

Finance.......in the othere word "money" is covering the most of our life style including our daily habits & daily needs.We all aware of the fact that we are often spend money beyond our capability....& practically it always effects our credit scores.

Now a days we all use credit cards more or less...whether it is for shopping or paying bills..... whatever.But none of us think that excessively using credit can also attracts your creditors to moniter you.Credit card companies continue to tighten their lending standards on card users.They are sneaking around your credit-data from your regular transaction receipts.They are doing this to identify the usege pattern of the custmer to be certain about the custmer's credit risk.

Have we often use credit cards for purchasing low grade food material , second-hand garments/products or for gambling, betting kind of things?we must be aware because the credit card service provider might be watching over us through our turnover records and making decisions about our creditworthiness according to our spending patterns.It compelled them to find financial distress in our behaviour & indications to be a defaulter of payment .The outcome will be higher interest rates & low credit limits.It immedietely effects the buyining pattern of a normal because higher interest rates & low credit limit results low utilization of credit card.it will also reduces the credit score of an indivisual.So use your credit card whenever you need, but always use it wisely.