Citigroup Mails More Credit Card Offers Than There Are Americans

Citigroup Inc. is hoping everyone and their mother and then some will sign up for a credit card.

The bank mailed 346 million credit card offers in the third quarter, The Wall Street Journal reports. That’s more than the approximately 308 million people in the U.S, according to the Census Bureau.

But even with the mailbox stuffing, the move may not pay off. Consumer use of revolving credit, which includes credit cards, dropped the most in six months in July, according to Bloomberg.

Americans may be saving more after racking up debt leading up to the recession, which could make it difficult for Citi's mail to get answered. The personal savings rate reached 5 percent in July 2011, according to The Commerce Department, compared with slightly more than 1 percent before the recession, according to The Washington Post. The interest in savings means consumers are getting better about paying off their credit card debt, the credit card delinquency rate was 0.6 percent in the second quarter of this year, down 35 percent from the same period in 2010, according to USA Today.

Consumers may also be hesitant about ratcheting up their debt as they see the economy headed for more slow growth. Americans' expectations of the economy fell in September to their lowest levels since May 1980, according to the Thomson Reuters/University of Michigan index of consumer sentiment.

Still, credit card use is growing from depressed 2009 and early 2010 levels, according to Digital Transactions. Credit card volume grew more than 7 percent from April 2010 to 2011, the site reports, but the country has 120 million fewer credit cards than it did in early 2009, the site reports.

Debit card use is also on the rise, as consumers choose to take on less debt, according to Digital Transactions. Signature debit card transactions jumped by almost 10 percent from April 2010 to 2011, the site reports, while PIN-debit transactions grew by nearly 5 percent.

While the growth in credit card use from 2010 levels may be good news for Citi’s new mailing campaign, if the company convinces customers to sign up for credit cards and the economy heads into a double-dip, they could be in trouble. Banks like Chase and Bank of America waived late fees and lowered interest rate charges on many of their credit card customers in early 2009 in hopes of collecting whatever fees they could get before customers defaulted, according to The New York Times.

If the Citi mail blast convinces customers to sign up for a credit card, they could have a new platform from which to use it — their cell phone. Google launched Google Wallet earlier this week, an Android app that allows users to charge items to their credit cards by tapping their phone against readers, according to The Guardian. The app currently can only be used with a Citi Mastercard, though Google is talks with Visa, American Express and Discover.

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