Liquidity pressures impacting the credit card industry
The current economic environment has many credit unions facing liquidity pressures causing senior leadership to take a closer look at balance sheet assets. External factors heightening these liquidity concerns include:
- Inflation and the associated rate hikes impacting balance sheet assets
- Slowing or negative deposit growth rates
- CECL implementation narrowing margins
These factors have forced many credit unions to realize that managing a credit card program is risky and requires a large amount of oversight. With the emerging liquidity concerns, rising delinquencies and losses, and the potential for an economic slowdown, or recession, there is a strong interest in an alternative solution to credit card self-issuing.
continue reading »