RP faces credit card crisis, expert says.

(From Philippine Daily Inquirer)

Byline: Doris C. Dumlao

THE PHILIPPINES is vulnerable to a credit card crisis in view of the consumers' skyrocketing household bills and the over-aggressive expansion campaign of credit card issuers, local bankers warned.

In an interview, Asia United Bank president Abraham Co expressed concern that the country might be nearing a credit card crisis as consumers were being burdened by the continued increase in commodity prices and utility rates.

As this happens, the consumers' purchasing power also shrinks, he said.

Co said credit card companies, for their part, were forced to be more aggressive in expanding their client base amid tough competition.

As more newcomers were being lured into investing huge sums of money to build the infrastructure for the credit card business, Co said issuers ended up merely eating up each other's since the market was not growing.