HSBC has revealed it may off-load its North American credit cards division if the US economic crisis deepens. No doubt HSBC will feel the pinch from new laws governing credit cards in the United States.
Although it may take some time to implement new laws, banks that try to take advantage of credit card holders will attract attention. In HSBC’s case, changes will undoubtedly effect profits, as it seems proposed changes could be designed specifically to stop HSBC abuse.
Chief executive Mike Geoghegan said a ‘rethink’ of the cards operation would be required if the recessionary ‘headwinds’ strengthen, causing more borrowers to default.
Wake up Mike, and read our complaints blog. If cardholders quit paying it may be from frustration or abuse, not because of unemployment. On the other hand, abuse may result in job termination, but cardholders cannot sue because of binding arbitration.
Loyalty and greed will become the real issues.
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