Proposed Changes to CARD Act Could Mean More Credit Customers For You
Background of the CARD Act of 2009
Under the CARD Act changes of 2009, it actually became harder for at-home spouses to get their own credit card, as Federal Reserve Regulations required a credit card issuer to verify the individual applicant has income or assets available to make payments — regardless of the total household income.
Potential Impact of Proposed Changes
Current proposals to change the CARD Act would allow a non-working spouse or partner over the age of 21 to report shared household income from the working spouse or partner in order to apply for a credit card in his or her own name.
Addressing Credit History Challenges
Among other things, this would address the scenario where a couple separates after many years, and the “at home” spouse, who may have been raising kids, suddenly finds they have no credit history in their own name. Studies show upwards of 16 million married couples who maintain households and don’t work outside. These proposed changes to the CARD Act would allow approximately one out of every three married couples the ability for the stay-at-home spouse to obtain a credit card in their name.
Implications for Businesses
New Customer Opportunities
When finally enacted, this could mean a raft of new credit-wielding customers, and also some interesting challenges for businesses:
Credit Usage Considerations
Would this credit only be used in emergencies? Are at-home spouses likely to swell the ranks of online shoppers?
Preparing Your Business
If so, is your business ready for the uptick in online business, and how should one address or cater to an “at home” shopper — even one who gets to the store when running the household — versus a credit customer who also spends their days at work?
Adapting to Customer Demographics
Customer demographics may undergo another refinement. Regardless, make sure you’ve contacted your AVPS and are up-to-date on your online and mobile processing options, so you can meet your customers — old and new — wherever it is they want to meet, and buy from, you.