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The credit card industry is undergoing a fundamental change in reaction to a changing market.
Consider these facts:
* Projections show that more than 2 billion pieces of direct marketing card solicitations will be mailed during 1995. This number is expected to se in 1996. That's nearly 20 pieces of mail for every U.S. household.
* No longer are low-rate credit cards the sole province of credit unions. Many of these cards have introductory rates well below prime, with rates settling six or 12 months later at 12.9 percent to 14.9 percent.
* Bankcard customers of all types now demand excellent customer service. Non-stop, 24-hour access is a threshold requirement for all issuers--including credit unions. "Business hours only" service is an anachronism.
* Consumers are demanding something back from credit card usage. No fee, low interest rate cards with value-added usage programs (cash back, merchandise rebates, entertainment values) are becoming increasingly popular in the marketplace.
Left with this situation, many credit unions see their card rolls becoming increasingly inactive. The variety and number of card offers hitting their members every day puts credit union card providers in a bind.
The low interest rate is no longer a unique selling proposition. The time has arrived for CU...