GE to Benefit from Credit Card Boom

Store-Brand Credit Cards Boom

The private-label corner of the U.S. credit-card market is enjoying a resurgence as fewer Americans fall behind on their payments.Like the broader credit-card industry, delinquencies on store-brand or private-label cards are slowing. That is good news for retailers such as Target Corp. and Nordstrom Inc. and issuers like Citigroup Inc. and General Electric Co. with hefty holdings of store-brand cards.Such specialized retail credit cards differ from so-called general-purpose cards used at multiple-location stores. Store-brand cards are considered riskier because those bills often rank lower in the payment hierarchy of customers in financial distress. A chunk of the customer base for these cards is made up of low-income households and less credit-worthy borrowers. As a result, these cards typically carry higher interest rates and lower credit lines than general-purpose cards.