A FOCUS ON: INDUSTRY CONSOLIDATION
CONCENTRATE!
James Walsh
The credit card industry in the US has witnessed dramatic changes over the past decade. These changes have had a material effect on cardholders and card issuers alike. As a result many banks and credit unions have decided to stop issuing credit cards themselves. The topic for this issue of the Brookwood Report is: What has happened, why has it happened and what can the remaining card issuers do?
Dramatic Changes in the US Credit Card Industry
In 1997 the top ten US card issuers controlled 57% of the US card Market while the remaining 3,000 card issuers held 43%. Since then, the credit card market has enjoyed strong growth: total card outstandings increased $291 Billion. Over this same period, the top ten issuers saw their card balances grow from $236 Billion to $611 Billion and their market share jump to 87%. Conversely, the remaining issuers watched as market share fell from 43% to 13% in seven short years. Put another way: the top ten captured all of the market growth and more...
