Citigroup doubles down on credit cards despite a slowing US economy


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Citigroup doubles down on credit cards despite a slowing US economy

Despite a withering backdrop in the US economy, which may have been at the brink of a recession, NY-based US multinational lender and financial service provider had been betting big on credit cards. In point of fact, according to the payments industry publication, the Nilson Report, NY-based Citi Group, the third-largest credit card issuer in the United States, behind American Express and Visa Inc., had been the most aggressive lender to embark on a zero-interest balance transfer.

Besides, consumer finance company Bankrate LLC said on Friday (September 6th) that the multinational US lender had been promoting the longest 0 per cent deal in the industry for the moment being with a no-interest pay off policy for as long as 21 months and transaction of debts from rival cards on to Citi’s plastic cards for a smaller fee.

As Citi Group had been stepping up effort to boost up its credit card usage, the lender’s card business has now been accountable for roughly one-third of the financial group’s entire revenue. Nonetheless, a basket of analysts and investors had begun to raise questions over Citi Group’s credit card portfolio, as a reversal of latest US monetary policy alongside a lower interest rate could turn the lender’s most profitable portfolio member in to a liability, as global rating agency, Moody’s analyst, Warren Kornfeld said, “Just recognizing where we are in the credit cycle, it’s interesting to see Citigroup doubling down and pushing forward. ”