In a twist that could only be scripted by 2021, the credit card industry witnessed a surprising boom in the first half of the year, particularly in June. According to a recent Equifax report, banks rolled out a staggering 42 percent more credit cards in the first six months of 2021 compared to the same period in the pandemic-stricken 2020, with a jaw-dropping 6.93 million new cards issued in June alone.
The Turnaround Tale: From Trepidation to Triumph
The credit card originations of 2020 began with promise but fizzled out, finishing 27 percent below the benchmark set in 2019 due to the looming shadow of the COVID-19 pandemic. Yet, as the nation collectively exhaled in June 2021, with COVID cases dropping and economic optimism on the rise, lenders and consumers alike seized the opportunity to embrace risk once more.
June 2021: The Perfect Storm of Factors
Why June, you may ask? Well, for starters, COVID worries took a backseat as cases plummeted to record lows, prompting a newfound sense of confidence in both job security and economic stability. Moreover, this surge in card sign-ups coincided with a flurry of enticing card launches and refreshes, luring eager consumers into the fold.
New Kids on the Block: Card Launches and Promotions Galore
June 2021 witnessed the unveiling of game-changing cards such as the Citi Custom Cash℠ Card and the Wells Fargo Active Cash® Card, each offering unique perks and rewards to entice potential users. Meanwhile, heavy hitters like the Chase Sapphire Preferred® Card and the Capital One Venture Rewards Credit Card upped their welcome bonus game, vying for a slice of the expanding credit card pie.
The Summer Spectacle Continues: July Keeps the Momentum Alive
As the sweltering heat of July rolled in, so did a wave of new card offerings and promotions. The Platinum Card® from American Express revealed tantalizing lifestyle benefits, while the Citi Premier® Card raised its welcome bonus to unprecedented heights, leaving consumers spoilt for choice.
Golden Age of Rewards: A Return to Opulence
Indeed, 2021 heralds a new golden age of credit card rewards, with even 0 percent balance transfer cards making a triumphant comeback. These promotions, once scarce in the wake of the pandemic, now abound, offering consumers a chance to leverage their debt and score lucrative rewards in the process.
A Tale of Two Trends: Openings Soar, but Limits Languish
While credit card openings soar to unprecedented heights, credit limits remain somewhat subdued, signaling lingering caution among lenders. Although lending standards have eased in recent quarters, credit limits have yet to rebound to pre-COVID levels, hinting at a tenuous balance between risk and reward in the industry.
In Summary: Seize the Day
In conclusion, the current climate presents a golden opportunity for consumers to capitalize on the abundance of credit card offerings, from cash back rewards to travel perks and beyond. With lending standards largely back to pre-pandemic levels, now is the time to explore the wide array of options available and embark on a journey of financial empowerment and rewards accumulation.
