5 Credit Card Predictions for 2015

This year Apple Pay launched and several major security breaches put consumers on edge. As we prepare to usher in a new year, U.S. News talked to several credit card experts about what to expect from credit card issuers in 2015.

1. Expanded credit access. Lenders tightened their standards during the recession, making it tough for many people with blemished credit to get approved for credit cards or other loans. But as card issuers strive to expand their market share, they've loosened credit standards and made credit cards available to customers with scores below prime. "I think next year it's going to be a lot easier for people to be approved for a credit card," says Nick Clements, a former banker and co-founder of MagnifyMoney.com, a comparison website for financial products. "That's a trend I see continuing from this year. Bad information tends to leave your credit report after about seven years, so a lot of bad stuff [foreclosures or other debts] is now leaving people's credit reports. People's scores are improving, but also banks are continuing to expand their credit risk acceptance." Andrew Davidson, a senior vice president at Mintel Comperemedia, a market research firm that studies credit card offers, agrees. "As the economy strengthens and delinquency rates remain low, instead of targeting consumers with high FICO scores, they're extending offers to consumers with less-than-stellar credit."

2. An uptick in balance transfer offers. During and immediately after the financial crisis, card issuers cut back on balance transfer offers, but experts say they're now seeing more zero percent APR opportunities. "Those balance transfer offers came back after a couple years," says Bill Hardekopf, CEO of LowCards.com, a free consumer resource on credit cards, "but the dilemma was the people with excellent or very good credit scores were the only ones those offers were going to." Now, he says, more consumers will have access to these offers so long as the economy stays healthy. However, Davidson says these zero percent introductory periods are becoming shorter. Eighteen- to 24-month offers were common in the past, but 13 to 17 months is becoming the new norm.

3. Increased competition for rewards card holders. As card issuers compete for new customers, expect to see more competitive cash-back and mileage offers. "It's a race to the top in headline cash-back rates," Clements says. "I think you're going to continue to see more sign-on bonuses, and the airline credit card space is going to continue to get interesting." According to Davidson, "cash back has been making a comeback, reversing a trend towards cards that promote flexibility of points." Keep in mind, though, that credit card rewards are typically subsidized by higher interest rates, so if you carry a balance, a no-frills credit card might be cheaper in the long run due to a lower interest rate. "For the savvy consumer, there are going to be more choices than ever," Clements says. "The savvy person who is willing to switch [credit cards] will be very well rewarded, but for those people who stay put, life is going to get more expensive if you're carrying a balance."

4. More free credit scores. About a year ago, a few credit card issuers began sharing FICO scores or VantageScores with their customers as part of their monthly statements. As competition heats up, more card issuers are now offering customers' scores for free. Recently, Citibank announced it would follow Capital One, Discover and Barclaycard by providing free scores starting in January. "This suggests we will go to a situation where free FICO scores will be the norm," Davidson says. Just note that there are many different credit scoring models, so while the information all comes from the three credit bureaus, the numeric score you receive might be different from what a lender sees when you apply for a mortgage, a credit card or an auto loan.

5. Greater innovation around credit card security. Security breaches at several major retailers have made data security a top concern for banks, merchants and consumers. Leading up to next October, when fraud liability will shift from card issuers to merchants if the merchant doesn't upgrade its payment terminal to accept chip-based credit cards, many issuers will send chip and PIN cards, which are already the standard in other parts of the world. Beyond chip and PIN cards, Davidson says issuers are looking at other ways to identify or avoid fraud. He cites Capital One Second Look, a new feature in a pilot phase that monitors customers' credit cards for duplicate and recurring charges that are higher than normal. "Security will become a key component of the marketing message," he says. "Issuers will look for ways to go above and beyond that with more innovative security features."