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Amex chief: Credit card firms face challenges

December 9, 2011

Credit card companies may have a hard time taking in the same levels of profits they did prior to the recession, according to some industry insiders.

Credit card companies may have a hard time taking in the same levels of profits they did prior to the recession, according to some industry insiders.

The Wall Street Journal reports American Express chairman and chief executive Ken Chenault told a crowd at a Goldman Sachs conference that consumers were less willing to take on debts and that the company would continue to go after wealthy consumers.

“We have had competition in the premium space for a long time, but given the changes that are happening in the industry I actually believe it’s going to be very difficult for a number of banks to return to the profitability and the financial dynamics that they had pre-financial crisis,” Chenault said, as quoted by the news source. He went on to say that consumers had become “more cautious” given the uncertainty in the economy.

One way that Amex is hoping to increase revenues is by giving customers added rewards at select retailers. From November 21 to November 30, card holders were able to get five times the rewards when shopping at Apple and Target stores.

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