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"GE toys with dropping out of store card market"

By admin | January 22nd, 2008 | Credit Cards, General

GE Money recently announced that it is reviewing the situation with regards to its role in the UK’s store card market, with a view to pulling out of the market if it is deemed unviable to continue. At present GE Money has over a 50% share in the store card market, and is responsible for store cards for household name retailers, such as Debenhams, TopShop, Dorothy Perkins, House of Fraser, and many others. A major review is being carried out by the financial giant to determine its viability in this sector.

A value of £1.5 billion has been placed on the business according to reports, and following the investigation GE may decide to sell this sector. In a similar move last year GE decided to look for a buyer for its American store card division, after the effects of the credit crunch in the United States wreaked havoc in the financial sectors.

Reports have indicated that there are a number of reasons behind GE toying with the idea of pulling out of the market, where it currently holds the number one position. One of these reasons is the high level of consumer debt in the UK, with the effects of the global credit crunch making matters even worse.

Another reason is the high level of criticism that store cards have been receiving, as they have been slated for the high levels of interest charged on outstanding balances, and have been accused of driving consumers into serious debt and contributing to the high debt levels in the UK.

Many consumers find themselves in serious debt as a result of credit and store cards, which are known for their very high interest rates, and many experts have blamed a large portion of the UK’s debt mountain on these cards.

Tags: GE money, store cards

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