Credit Cards

Credit Cards

Brief Excerpt from Industry Overview Chapter:

Companies in this industry issue credit cards used by consumers and businesses to purchase goods and services in return for payment in full or in installments. Major companies include Alliance Data Systems, American Express, Capital One Financial, and Discover Financial (all based in the US), as well as Credit Saison and Mitsubishi UFJ NICOS (both of Japan), and UnionPay (China). Major retailers, banks, and oil and gas companies also issue credit cards.

COMPETITIVE LANDSCAPE

New payment technologies, including contactless, digital, and mobile payments, are disrupting the lucrative global payments industry and forcing credit card issuers to innovate and form partnerships. Changing consumer preferences and attitudes toward debt present additional challenges to the credit card industry. Hyper-connected, debt-averse millennials -- the largest customer base -- are tending to shun credit cards. Baby boomers and Generation X carried an average of 4 to 5 credit cards, while millenials and the Generation Z carried 2-3 credit cards, according to Creditcards.com. Younger people are turning instead to companies such as Apple, Amazon, Google, and PayPal, and social platforms that have entered the digital and mobile payment landscapes with products like mobile wallets and wearable devices for making payments at the point-of-sale (POS). The emergence of these potentially competitive networks has primarily been via the online channel with a focus on e-commerce or mobile technologies. PayPal and China's AliPay and WeChat are examples of companies that compete with card issuers in some...