Credit card offers returning to American mailboxes

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For the first time in months, I opened my mailbox and discovered a thick envelope from a credit card company of which I wasn't already a customer. I wouldn't exactly say I was missing all those solicitations, especially when they made up about two-thirds of my daily mail. But the quiet retreat global banks took from customer acquisition during 2009 and 2010 made me nervous, just as it had analysts buzzing.

Researchers at Synovate, a market intelligence firm, decided to measure just how much direct mail disappeared from our nation's mailboxes during the economic crisis. It turns out that banks mailed only 349 million credit card offers during the second quarter of 2009. That's one of the lowest figures since banks started the practice a few decades ago. Synovate researchers say that mailings nearly doubled this spring, to just over 640 million offers.

Of course, the offers aren't quite as good as what we're used to. Before the economic crisis, it was pretty common to see multiple offers for no interest teaser rates, no-fee balance transfers and extended promotional periods. In the same Synovate study, researchers discovered that banks have stretched out the gap between the prime rate and their average interest rates to the largest it's been in 22 years.

For banks, it's a shrewd move to help them return to profitability. The CARD Act and other financial reform measures took away many of the fees and finance charges that made issuing credit cards such a lucrative business. Now that issuers must lock new accounts into a fee structure upon signing, we're seeing many more variable rate cards tied to that percentage spread. Synovate officials noted in a press release that Discover was the first major issuer out of the gate with this strategy, ramping up their mailings by 70% over the past year.

Citi has made some strong moves in 2010, as well, nearly tripling the amount of mail they're sending to potential new customers. Synovate's market research indicates that consumer credit card spending has crept back up to where it was in 2008, making it the right time for lenders to get competitive. Still, with so many Americans researching credit card rates online, how much longer will banks rely on the Post Office to get the word out?

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