Excessive Credit Card Debt Starts at the National Level

Excessive credit card debtMost people advocate the case of credit cards, extolling the benefits and convenience of using them. However, there is another way of thinking that strongly opposes credit cards. The reason being the issues that arise from Excessive Credit Card Debt, which is one of the most serious problems faced by the credit card holders and credit card industry today.

However, we can’t shut down the credit card industry just because of a few irresponsible people (or even if it’s more than few). That is not a solution for beating excessive credit card debt. There are real benefits associated with credit cards that can’t be overlooked.

The issue of excessive credit card debt can be looked at from 2 angles.

First is addressing excessive credit card debt problem at the industry level, and second is to focus on the excessive credit card debt problem from the individual credit card user level.

The first method involves increasing awareness of the excessive credit card debt problem to the masses. This is more or less being done currently – the state of our economy right now has made the average consumer aware of the problem. However, there should also be an effort to tackle this problem of excessive credit card debt at an even deeper level. This means trying to devise a way to change the current practices of the credit card industry. Particularly their practice of sending a gazillion credit card offers to people over and over again, despite their ability to pay for one or multiple credit cards with balances.

In many ways, the credit card industry has gotten away with murder and has brought on the nations excessive credit card debt problems themselves. But much thought needs to go into devising a change that includes the proper checks and balances for the credit card industry as a whole.

Case studies should be taken up, statistics gathered and a proper forum formed (with representatives from the credit card holders and from the credit card suppliers). As of now, the credit card suppliers just seem to still be hell-bent on coming out with new credit card products and getting customers enrolled in those products. There is little attention paid to addressing the problem of excessive credit card debt in the real sense.

Perhaps attending mandatory seminars on the root causes of excessive credit card debt could be made part of the credit card application process for potential new card holders. I can see that this could be a reasonable requirement for college students, for instance, when offered that first EVER credit card account.

Another way of dealing with the problem of excessive credit card debt could be developing a system for calculation of applicable credit card limit at the individual level – no standard/product-based credit limits. Then there could be mechanisms put in place for proactively warning the users about excessive credit card debt (based on their credit card usage and balance) or even imposition of early restrictions when the first signs that lead to excessive credit card debt appear.

At the credit card holders’ level, the treatment of the problem of excessive credit card debt would include following of best practices (on credit card usage and avoidance of excessive credit card debt) by the individuals themselves. A checklist or a set of questions could be provided to individuals for recognising the first signs of excessive credit card debt.

So, the problem of excessive credit card debt can surely be dealt with by putting together some serious changes at a broader national or government level, together with increased spending and debt management discipline at the individual credit card holders’ level.

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Filed under: Credit Card Debt Relief

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