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"GE Money reviews UK store card market viability"

By admin | January 15th, 2008 | Credit Cards

Financial giant GE Money is said to be reviewing its role in the UK store card market, and according to reports the company may be looking at brining its involvement in the UK store card market to an end. GE Money has a monopoly in the UK store card market, with responsibility for over 50% of UK store cards. One of the reasons why the company is considering withdrawal from the market is the high level of consumer debt in the UK.

GE Money is now said to be conducting a review of the UK store card market in order to assess whether or not it should remain part of the market, where it currently holds the number one position. The company currently operates cards for a number of household retailers, and this includes Debenhams, TopShop, Dorothy Perkins, House of Fraser, and many others. The current market value of the business is £1.5 billion according to reports, and according to the conclusion drawn following the market review the business may have to be sold.

The store card market has always been at the centre of controversy as a result of the extortionate interest rates applied to accounts where customers spread the balance. This has resulted in widespread criticism of store cards, and this is said to have also contributed to GE Money’s decision to review whether or not it wishes to stay in the market.

GE also decided to look for buyers for its American store card division last year, with the widespread credit crunch creating difficulties throughout the United States when it came to the credit markets. The effects of the credit crunch have resulted in higher inter-bank lending fees, and this has made it difficult for lenders to extend credit to new consumers due to the risks involved.

Tags: store cards, GE money

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