Synchrony, Comenity vulnerable in next recession

[pdxmike]

Summary:
- Stores are closing
- People stop paying when stores close
- People don't open accounts when stores close
- Missed payments and write-offs are rising
- Bank cards are more competitive
- "Some investors are betting that the standalone card issuers will be among the most vulnerable financial firms the next time the economy tips into recession."

https://www.wsj.com/articles/heres-the-credit-card-thats-gathering-dust-in-your-wallet-1512050400

[K-in-Boston]

Link is behind a pay wall.

I think they're always vulnerable - recession or not, which is why most of the cards have a very high one-size-fits-all APR whether your score is 620 or 850.  Bank cards aren't necessarily more competitive, though.  Other than introductory offers, few cards extend something like "0% for 24 months" to an established cardholder and while there are cards that may have 5% rotating categories that cover many of the stores that have store cards issued, it's difficult to find normal bankcards that match the discounts or statement credits if you shop that store regularly.

[DaveInAZ]

I could only read the first paragraph since I don't subscribe to the WSJ. But did the article actually make these claims?

- Stores are closing

No **bleep**, Sherlock. Going to a mall used to be a social thing. Now Social media is the social thing, and it's easier and usually cheaper to buy online and let UPS drop it off at your front door.

- People stop paying when stores close

Did they offer any evidence for this? Stores closing alone is no reason to stop paying, unless of course you lose your job at a store that closed. But unemployment is still very low, and low paying retail jobs are easily replaced by low paying jobs in restaurants or similar, and Walmart brick & mortar stores are still doing fine.

- People don't open accounts when stores close

Again, any evidence for this? Same argument as above, plus I would argue that stores closing is more reason to open accounts - the folks that still pay with cash or check need to use debit or credit to buy online, so more incentive to open accounts that offer credit/debit.

EDIT: Just want to make sure it's clear that my No **bleep** Sherlock comment is directed at the WSJ, not the OP, pdxmike.