Yesterday's Wall Street Journal reported that credit card companies are cracking down on their credit approval process. The Federal Reserve wants to restrict some common moves by credit card issuers, such as raising interest rates on troubled borrowers. Proponents say that these steps would curb abusive practices and opponents say the new rules could unravel innovations that allowed card issuers to price risk accurately.
Credit card companies have been receiving criticism on their hidden fees and unfair interest rates and the raising of those rates on borrowers.
How does this affect your business?
Have you taken steps to change the steps your company takes when it extends credit, or charges late fees or offers discounts?
Be very careful when offering credit and be sure to check each applicants credit with a fine tooth comb. Do not extend credit if you have any doubts, now is the time to tighten up your credit polices in order to protect your business.
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