topic Re: When Target will listen to the consumers? in Credit Cards

When Target will listen to the consumers?

Anonymous — Tue, 19 Mar 2013 12:16:00 GMT

I am trying to understand why Target wont increase the credit limit on their costumers credit accounts

When they open the account is only for 300 to 700$ and after that no increase

So if we got to Target to shop and chose to revolve on the card balance we risk hurting our credit score if lets say we spend 650$ from 700$ limit because we are close to the limit

I understand in some cases the fico wont be impacted on over all utl. but the transunion fico score is looking some times at an individual account utilization

Any suggestion?

Re: When Target will listen to the consumers?

CreditCrusader — Tue, 19 Mar 2013 12:30:38 GMT

@Anonymous wrote:
I am trying to understand why Target wont increase the credit limit on their costumers credit accounts
When they open the account is only for 300 to 700$ and after that no increase
So if we got to Target to shop and chose to revolve on the card balance we risk hurting our credit score if lets say we spend 650$ from 700$ limit because we are close to the limit
I understand in some cases the fico wont be impacted on over all utl. but the transunion fico score is looking some times at an individual account utilization
Any suggestion?

For the same reason that Cap1 and Discover are generally conservative with their CLs. They are understandably more concerned with properly managing their risk than helping your credit score.

I wondered this very thing when I was approved for an Old Navy card back in the day. I used it...paid it off...but to this day, they refuse to budge from the $200 limit they first gave me.

Look at it this way: Every additional dollar of CL that a lender gives a consumer constitutes an additional dollar of risk. They can't assume that people will maintain current spending habits and ability to repay when they bump up CLs. It's all about managing risk, and Target isn't in the the high-risk business.

Re: When Target will listen to the consumers?

Anonymous — Tue, 19 Mar 2013 13:04:23 GMT

I understand that but how are we suppose to buy anything over 700$ like tv or other appliances for 1200$ ?

I dont think they are bad store but they need to partner with a big bank to have the additional capital to finance their products

I have a target near me and they are underwater compare to walmart that is always full of customers for the simple reason that they are giving good credit limits on their credit accounts in addition to better prices IMO

Re: When Target will listen to the consumers?

CreditCrusader — Tue, 19 Mar 2013 13:20:41 GMT

@Anonymous wrote:
I understand that but how are we suppose to buy anything over 700$ like tv or other appliances for 1200$ ?
I dont think they are bad store but they need to partner with a big bank to have the additional capital to finance their products
I have a target near me and they are underwater compare to walmart that is always full of customers for the simple reason that they are giving good credit limits on their credit accounts in addition to better prices IMO

But you have to understand that Target's common shopper is not, for the most part, buying the big-ticket items. They are generally buying protein bars, candles and the like. Target isn't going to change their business model on the off chance that someone may want to finance a TV.

I get what you're saying, but what you are wanting represents a larger risk than the potential reward.

Re: When Target will listen to the consumers?

Anonymous — Tue, 19 Mar 2013 13:29:01 GMT

I guess all the banks like Chase Bof america Amex need to reduce the credit lines to $500 for all the costumers because the risk is high base on your philosophy

Re: When Target will listen to the consumers?

Smug — Tue, 19 Mar 2013 13:34:09 GMT

I closed my Target card, they gave me 200.00 when I have 20k cards....MEH...

Re: When Target will listen to the consumers?

youngandcreditwrthy — Tue, 19 Mar 2013 13:36:17 GMT

Typically, sales expansion includes credit availability expansion for a retailer.

They should change banks to GECRB. I might re-open a Target card if that were the case.

Re: When Target will listen to the consumers?

Anonymous — Tue, 19 Mar 2013 13:42:13 GMT

I would reopen my Target if they switch to GECRB.That way i know they would have a good cl

Re: When Target will listen to the consumers?

CreditCrusader — Tue, 19 Mar 2013 13:52:36 GMT

@Anonymous wrote:
I guess all the banks like Chase Bof america Amex need to reduce the credit lines to $500 for all the costumers because the risk is high base on your philosophy

You are mixing apples and oranges now. Chase, BOA and Amex are high rollers...and typically give healthy credit lines only to those who are deemed to be superior with regards to credit and income/ability to repay. Target is a retail store that just wants you to buy their stuff, but is not dependent on credit products for those purchases.

In addition, Target has the debit Redcard product that provides the same 5% discount incentive that the credit product does. Credit just isn't a big part of their business model, and is therefore restricted.

I think it is important to be fair in discussing these matters. Let's be honest: We want fat CLs because we want to be able to use the cards and not tank our FICOS. It's a bit selfish to turn the criticism on the lenders for not putting themselves at risk to satisfy our selfish credit desires.

Re: When Target will listen to the consumers?

seattletravels — Tue, 19 Mar 2013 13:56:10 GMT

@CreditCrusader wrote:
I think it is important to be fair in discussing these matters. Let's be honest: We want fat CLs because we want to be able to use the cards and not tank our FICOS. It's a bit selfish to turn the criticism on the lenders for not putting themselves at risk to satisfy our selfish credit desires.

Also - why are you so worried about UT%? I understand wanting to keep you score as high as possible - but unless you're planning on a big purchase (home/car), does it really matter? For such a small amount charged - ($300-700), couldn't you have that paid off in a short amount of time?

Re: When Target will listen to the consumers?

FinStar — Tue, 19 Mar 2013 13:56:30 GMT

@CreditCrusader wrote:
@Anonymous wrote:
I guess all the banks like Chase Bof america Amex need to reduce the credit lines to $500 for all the costumers because the risk is high base on your philosophy
You are mixing apples and oranges now. Chase, BOA and Amex are high rollers...and typically give healthy credit lines only to those who are deemed to be superior with regards to credit and income/ability to repay. Target is a retail store that just wants you to buy their stuff, but is not dependent on credit products for those purchases.

In addition, Target has the debit Redcard product that provides the same 5% discount incentive that the credit product does. Credit just isn't a big part of their business model, and is therefore restricted.

I think it is important to be fair in discussing these matters. Let's be honest: We want fat CLs because we want to be able to use the cards and not tank our FICOS. It's a bit selfish to turn the criticism on the lenders for not putting themselves at risk to satisfy our selfish credit desires.

Couldn't have said it better.

Re: When Target will listen to the consumers?

Anonymous — Tue, 19 Mar 2013 13:58:29 GMT

@CreditCrusader wrote:
@Anonymous wrote:
I guess all the banks like Chase Bof america Amex need to reduce the credit lines to $500 for all the costumers because the risk is high base on your philosophy
You are mixing apples and oranges now. Chase, BOA and Amex are high rollers...and typically give healthy credit lines only to those who are deemed to be superior with regards to credit and income/ability to repay. Target is a retail store that just wants you to buy their stuff, but is not dependent on credit products for those purchases.

In addition, Target has the debit Redcard product that provides the same 5% discount incentive that the credit product does. Credit just isn't a big part of their business model, and is therefore restricted.

I think it is important to be fair in discussing these matters. Let's be honest: We want fat CLs because we want to be able to use the cards and not tank our FICOS. It's a bit selfish to turn the criticism on the lenders for not putting themselves at risk to satisfy our selfish credit desires.

The big banks give big credit lines to big spenders becasue they want the swipe fees, Target isn't going to get huge swipe fees from people that can only show at Target.

Re: When Target will listen to the consumers?

CreditCrusader — Tue, 19 Mar 2013 13:58:48 GMT

@youngandcreditwrthy wrote:
Typically, sales expansion includes credit availability expansion for a retailer.

They should change banks to GECRB. I might re-open a Target card if that were the case.

Not true at all, really...at least not in a blanket sense.

Look at Dick's Sporting Goods. It has a credit card, but typically starts people off at $124 limit and isn't known to grow by leaps and bounds. Other retailers have also been known to constrict credit for absolutely no reason other than a risk assessment contingency.

And, quite frankly, look at Target. If restricting credit was damaging their bottom line, I suspect they would make a change.

This is purely a business decision...one that is specific to the needs of each, not our credit desires.

Re: When Target will listen to the consumers?

Anonymous — Tue, 19 Mar 2013 13:59:22 GMT

You realise that Target is a giant retail store right?

And that is a multibillioner company.Target is a high roller.I know they have the money to lend

Why not lend right? Every other store does lend much more then target even though they are much smaller comanys then Target is

I guess the solution is new managment on Target.IMO

Re: When Target will listen to the consumers?

Anonymous — Tue, 19 Mar 2013 14:04:46 GMT

@Anonymous wrote:
You realise that Target is a giant retail store right?
And that is a multibillioner company.Target is a high roller.I know they have the money to lend
Why not lend right? Every other store does lend much more then target even though they are much smaller comanys then Target is

I guess the solution is new managment on Target.IMO

It's pretty simple, they are trying to hold their risk to a minimum for each individual.

the big banks are willing to give high credit lines in return they get the swipe fees from people who spend, Target isn't getting swipe fees so they don't have that source of income to justify the risk from the credit lines.

Re: When Target will listen to the consumers?

CreditCrusader — Tue, 19 Mar 2013 14:13:51 GMT

@Anonymous wrote:
You realise that Target is a giant retail store right?
And that is a multibillioner company.Target is a high roller.I know they have the money to lend
Why not lend right? Every other store does lend much more then target even though they are much smaller comanys then Target is

I guess the solution is new managment on Target.IMO

Because it isn't conducive to their business model...period. Every other store means squat to Target, and the business models of others isn't necessarily what will be successful for Target. And increased lending equals increased risk. Target knows, as most all of us do, that people can utilize any number of other credit products at their store...including Visa, MC, Discover, etc. Why should they increase their risk just to satisfy some random credit watchers' desire to keep util low and still use the product heavily?

I'm sorry to be so harsh with the truth, but this is the way the business world works. Target's model works for them...that's all that matters. Our personal credit goals and complaining should not be used as criteria for how Target issues its credit products. That is not smart business, regardless of how frustrating it may be to some individuals.

Re: When Target will listen to the consumers?

FinStar — Tue, 19 Mar 2013 14:13:17 GMT

@Anonymous wrote:
You realise that Target is a giant retail store right?
And that is a multibillioner company.Target is a high roller.I know they have the money to lend
Why not lend right? Every other store does lend much more then target even though they are much smaller comanys then Target is

I guess the solution is new managment on Target.IMO

TARGET is not the lender. They may be one of the largest retailers but by no means are they "failing" for not extending any extra credit to you via their credit card. They have other methods of payment that they accept and are still doing well financially - even if you don't have their revolving credit card.

TNB was the previous underwriting body for all Target accounts. This switched to Toronto Dominion (TD) Bank not long ago. TD Bank absorbed their private label portfolio and is known to be very a very conservative lending institution.

TNB had a very expansive credit growth in the early 2000's which led to the demise of deteriorated portfolios due to high credit losses when the financial metldown hit, and discontinued their Visa product as a result. So, I think it's smart for TD Bank and their cautious approach with extending credit on a conservative basis given the previous history.

You have choices, they have options.

Re: When Target will listen to the consumers?

youngandcreditwrthy — Tue, 19 Mar 2013 14:24:51 GMT

Typically banks change Credit Servicers/companies when the current one is unprofitable,
But if TD operates the way TNB did... They prob won't see an uptick in sales..
And let's face facts, retailers choose banks that produce and increase in sales; that's the whole point of any provision of credit products- to increase sales.
I remember trying tirelessly to get Targét to upgrade my Red Card to a Visa lol... Never happened! Heh

Re: When Target will listen to the consumers?

CreditCrusader — Tue, 19 Mar 2013 14:32:51 GMT

@youngandcreditwrthy wrote:

I remember trying tirelessly to get Targét to upgrade my Red Card to a Visa lol... Never happened! Heh

I hear you...and don't get me wrong, I wish these cats would all give us healthy credit lines so we could use them and not fear the dreaded UTIL bump. But then I look at this whole game from a business perspective...and when I do, I realize that when Cap1/Target/etc. restrict access to credit, they are doing it to minimize risk. In the post-2008 financial world, that doesn't seem like a bad approach at all

Re: When Target will listen to the consumers?

youngandcreditwrthy — Tue, 19 Mar 2013 14:42:19 GMT

Yeah, except that C1 will increase a line if you go through the EO ;-) lol...
I think if you have a solid payment history as I did in Cap One's case(5 years, no lates or over limits) and one year of the same with TNB, that should be enough of an indicator of low risk...
But I do get it. I also think that Cap One's business model isn't to limit risk, but to increase Revenue Per Account. The more low limit accounts they can pump out with fees/high rates... The more profitable they are. Idk about Target/TD though. No experience with them lol