The High Cost of Web-Based Applications
Credit Card Management (07/00) Vol. 13, No. 4 p.10; Parker, Robert A.

Many credit card issuers pay more to acquire a card account on the Web than by traditional means. The leading credit card issuers pay from $65 to $90 per online account. One reason for the Web's high acquisition costs is the fact that the Internet gives card issuers few ways to screen their applicant pool, which could result in bad credit. But with time and experience online, many issuers have been successful in lowering acquisition costs. CompuCredit, for example, was able to lower its acquisition costs from $100, when it first started, to $40 currently. The company uses data about consumers from firms that maintain opt-in e-mail lists, takes the information to credit bureaus, and then sends e-mail offers to consumers who meet their criteria.

Back   | Home   |  News Archive