MBNA spoiling for a fight

YorkshireBoy

Edna_Bucket wrote:

However, can't we judge by the actions or rather reactions of the card companies (and they tend to be a very reactive bunch of course.) If stoozing wasn't having an impact on their thinking why would they be rushing to "tighten up" procedures to try and cut down on it?

The only people to "tighten up" on stoozing specifically are MBNA with their new 'money transfer' definition, although I believe that this is still possible with Virgin - who have yet to adopt this definition in their T&C's. However, this is more than countered by Egg's Money Card launch back in September.

So, I still don't think stoozing is having that much of an impact on the CC providers profits. The things impacting on the CC providers, as I see it, are:

* Personal insolvencies at record levels (20,000 expected in 1st qtr 2006)
* IVA's rising
* Debt management plans increasing
* The OFT's investigation on "punitive" charging.

The CC providers are now looking towards maintaining their revenue streams in other ways, and are resorting to making changes to their T&C's (such as introducing annual fees and changing APR's - as in the case of MountainOfDebt), which is something they have always reserved the right to do (and you agree that they can when you sign the credit agreement).

Very few providers are willing to break ranks on the 0% market - the most notable of late being Nationwide (but only on BT's) & IF (although parent Halifax still retains a foot in the market).

Indeed, just lately we have seen some great new 0% offers, eg Halifax One capping their BT fee, the long 0% Capital One deal, HSBC's '9 months on both with fee-free BT' Xmas present to all of us, and the new Mint offer incorporating an anniversary bonus like Egg's. And all this is *before* the 'January sale' starts for the Xmas overspenders.

Edna_Bucket_2

I wouldn't necessarily disagree with any of that YB, and didn't with your previous comments - that said I think the companies concerned are moving to protect their position.

But am I not right in thinking that more of these people have BT fees now than they did? Egg for example? That may not "stop" the serious stoozer, but it marks a departure from the 0% and no BT fee days.

As I said before, I don't think we've seen the half of it yet - the very threats that industry is facing (OFT very good example) will make them co-operate more closely, and information sharing is going to make things very tight indeed, as is consolidation in the market (Morgan Stanley buying Goldfish from Lloyds only in last few days - watch out for much more of that sort of thing in 2006.)

digp

Did you know that MBNA's CEO is a lawyer?