Credit card pre-approval rates edge to pre-lockdown levels

Pre-approval rates for credit cards have doubled in the last month, according to new analysis from Experian.
 
Half (50%) of consumers searching for a new credit card through the credit reference agency’s Credit Barometer will now be shown a card they are pre-approved for, meaning their application should be successful.
 
Experian suggested that economic uncertainty during the COVID-19 pandemic has left many lenders re-evaluating their offers, and subsequently tightening lending and affordability criteria. As a result, the number of people that saw a pre-approved card fell to one in four (24%) during July. 
 
However, in the weeks since many business sectors in the UK reopened, and more people returned to work, several lenders have introduced products back to the credit market. The credit reference agency suggested this has led to a consumer’s chance of being approved for a credit card edging closer to levels seen before the COVID-19 lockdown.

At the beginning of March, 55% of consumers searching for a credit card through Experian were shown a pre-approved card.

Experian Marketplace managing director, Amir Goshtai, commented: “Over the past few weeks, we have seen significant improvements in the credit market. Last month we revealed that consumer eligibility for loans had improved by 60%.

“Now we’re seeing similar levels of growth in the credit card market, which had been impacted more by changes in lenders’ appetite for risk. Our panel of credit cards is now 50% higher than what it was a month ago, offering plenty of choice for consumers. These are all positive signs of recovery for the UK economy.
 
“Eligibility ratings mean people searching for credit can check their chances of approval before submitting an application – giving them confidence in applying for credit and protecting their credit score, especially during such challenging times. People looking for credit should use comparison services until they find the right product for their needs.”

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