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Credit Risks Not Getting the Message

People with bad credit refuse to stop applying for credit cards online.

Meanwhile, online credit card applications from people with good credit have dropped for the first time in five quarters.

One group of people has gotten the message about getting too much credit. The other? Not so much.

ComScore, which tracks online behavior, released data today on online credit card applications from people with a credit rating of more than 660 and from those with a rating of less than 660 -- the group considered subprime.

ComScore found that during the second quarter of this year, online credit card applications from good credit risks dropped 19 percent, compared to the same period last year.

However, during the same period, online credit card applications from bad credit risks -- the subprime customers -- rose 7 percent.

Note that this data was from the second quarter -- April, May and June -- even before the crisis really escalated.

Take a look at comScore's data dating back to the second quarter of 2007, showing the combined online credit card applications from people with good and bad credit. You'll see that everyone was drunk on credit:

Q2 2007: up 28 percent (compared to Q2 2006)
Q3 2007: up 10 percent
Q4 2007: up 11 percent
Q1 2008: up 8 percent
Q2 2008: down 6 percent

The survey included the top 10 credit card issuers, including Amex, Bank of America and Capital One, among others.

-- Frank Ahrens

By Frank Ahrens  |  October 27, 2008; 5:27 PM ET
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