Aug 9, 2008
Exporting Credit Cards Abroad
A great graphic that shows us the change in the number of credit cards worldwide:
via Outside U.S., Credit Cards Tighten Grip (NYTimes)
I have to wonder what the long term effects of credit cards will be in some of these BRIC/Emerging markets. On one hand, the increased access to credit will somewhat help certain individuals within an economy. It’s possible that you could see pockets of increased consumer spending. At the same time, like the article discusses – certain card holders could accumulate too much debt which could lead to protectionist measures by local governments.
The other problem that I see is that many of the countries reporting large changes in credit card numbers are ones with economies tied to the bull market in commodities. If that turns south you should expect credit card usage to go down as well.
Either way, it’s something worth taking a look at when trying to find positive tailwinds for your investments abroad.
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