Disclosure: I receive NO compensation from credit card affiliate partnerships. Support the blog by applying for a card through my personal referral links
The miles and points game doesn’t operate in isolation. When we talk about miles and points earning, a lot of it is often contingent on getting approved for lucrative welcome bonuses. As markets tighten, banks are bound to increase restrictions on lending. They’re bound to impose more guardrails in order to minimize their risk. Chase is no different. As per many reports, Chase is already tightening up when it comes to issuing credit card approvals for many of their cards. This isn’t surprising given how their CEO recently opined that we’re in a ‘bad recession’.
Chase Credit Card Approvals
Multiple reports on reddit point out that Chase is tightening credit card approvals for many of their credit card products. Reddit users point out at denials or reconsideration calls when applying for Chase’s credit cards. As per this Reddit thread, Chase denied applicants for these cards:
- Chase Freedom Unlimited
- World of Hyatt
- Chase Ink Business Unlimited
- Chase Sapphire Reserve
While the details for the denial aren’t as clear, one commenter posted that ‘too many inquiries’ was the reason stated by Chase. In the same discussion, other commenters point out how they applied for Amex cards and got approved for them. You can read the entire thread here.
Chase Earnings Call
In a post last week, I highlighted how banks’ own financial reporting is indicating a general tightening of markets. It’s no surprise that Chase is putting more barriers before approving people for credit cards. On the most recent earnings call, here’s what JP Morgan Chase CEO Dimon said:
When we get to the end of the second quarter, we’ll know exactly what happened in the second quarter. We know – you got to respect the credit card delinquencies and charges will go up though we’ve seen very little of it so far. But, in the second quarter, you’ll see more of it.
You can read the full report here. Given these public comments as well as Q1 financials, it’s no surprise that Chase is taking a conservative approach. Many lenders could simply adopt a similar approach and wait and watch until Q2 ends.
The Pundit’s Mantra
Over the last few weeks, banks have reacted to the economic slowdown. As expected, they’re trying to limit their risk exposure. In the short term, I won’t be surprised if this trend of tightening approvals continues. In the meanwhile, banks could be switching to alternate methods and sending out targeted offers to customers they wish to acquire.
As I pointed out in this post, I’m planning to go lean and wait as the situation unfolds. I have enough miles and points to book my next trip. Hence, in the short term, I’m limiting my annual fees. By not applying for cards in the short run, I hope I’m also avoiding any undue attention to my accounts or activity.
What is your credit card application strategy looking like in the short term? Have you faced any hurdles in getting approved for a credit card recently? Tell us in the comments section.
___________________________________________________________________________________________________________________
This card is currently offering a 50,000 points bonus and a 0% Intro APR for 1 year, with a $0 annual fee!
___________________________________________________________________________________________________________________
Never miss out on the best miles/points deals. Like us on Facebook, follow us on Instagram and Twitter to keep getting the latest content!
PERSONAL REFERRAL LINKS (LINK ABOVE) gives an am-ex site that reads:
[…] few weeks back, I wrote about how major card issuers like Amex and Chase are making changes in response to market conditions. Card issuers are approving […]
These big banks have had their corporate customers draw down large on their revolving lines of credit.
That impacts risk weighted assets and the availability of credit to other lines of business in the bank. Wells is pulling back on HELOC, JPMC on Cards.
Hi Stephen,
Thanks for reading and for sharing that insight. Yes, it looks like other banks may follow suit and this could be the norm for Q2.