The average American has roughly three credit cards in her wallet, each with an average balance of $6354 ($1841 for retail cards). Total US credit card debt tipped over $1 trillion in 2017 and continues to climb at around 5% a year. In other words, things are going pretty well for credit card companies.

Or are they?

With thousands of credit card products out there, it’s exceptionally hard to stand out these days. The competition from fintech gets fiercer every day, default rates are rising, and debit card use is growing in popularity. In response, banks have reduced their credit appetites, narrowed their card offerings and lowered their margins.

And they’re not sitting still. In the past few years, they’ve increased their appetite for product innovation as well. Here are some examples:

1. FICO score open access provides more transparency

In November 2013, FICO announced the FICO Score Open Access program, and, as of February 2018, reached more than 250 million consumer accounts.

Through this program, many credit card issuers have been able to provide customers with free access to their FICO credit score, empowering them to take control of their credit so they can become more creditworthy. Discover has even gone so far as to offer access to non-customers.

2. Mobile payment services make credit cards safer to use

Most credit card companies have gotten the message: if they want to compete, they have to up their mobile game. Mobile payment services like Apple Pay, Samsung Pay and Google Pay already have the jump on them.

These upstarts use tokenization technology, which replaces the original credit card information with a unique token to process a transaction. Tokens are randomly generated, so thieves can’t reverse-engineer them to get the original card number.

While it took card issuers time to make it possible for their cardholders to use these services, the integration is now universal.

In November 2016, JP Morgan Chase even launched its own mobile payment service, Chase Pay, for its credit cards. Partnering with Visa to get direct access to its network, Chase Pay effectively removes the middleman in its mobile payment transactions. Also, since participating merchants are required to become customers of Chase’s business payment processing business, both the merchant and the customer are using the bank’s network.

This effectively makes it cheaper for businesses to accept Chase Pay than other mobile payment services. Also, cardholders can use Chase Pay regardless of which operating system their smartphone has. That’s not the case with some of the competing mobile payment services.

3. EMV chips also shore up some security vulnerabilitiesCredit card information is among the most coveted bits of data for those involved in cybercrime. In 2015, the credit card industry began the shift toward EMV chips to provide more security for credit cardholders. As of October of that year, retailers were required to upgrade their card readers to accept the new technology.

EMV technology uses tokenization and encryption to keep card information secure. However, the standard in the U.S. is currently chip and signature, which still makes it possible for thieves to steal a credit card and use it for point-of-sale purchases.

In contrast, the standard in Europe is chip and PIN, which requires cardholders to use a PIN much like a debit card. This makes it harder for fraudsters to use a stolen credit card unless you’ve let your PIN slip.

Also, EMV chips only combat one form of theft: counterfeit fraud, which happens when a thief steals the dynamic card information from a card’s magnetic strip. Card-not-present (CNP) fraud, which happens when a thief doesn’t need to present a physical card, such as for online purchases, isn’t impacted by EMV chips.

In fact, it’s starting to become thieves’ fraud of choice. Juniper Research has estimated that the value of CNP fraud will reach $19.3 billion in 2022. To give you a reference point, the total value of identity fraud in 2017 was $16.8 billion, according to Javelin Strategy & Research.

4. New rewards and features keep people using credit cardsIn an effort to stay competitive and entice consumers to stick with credit cards over other payment methods, many credit card issuers have beefed up their rewards programs and card benefits. Here are four examples of recent innovations:

Bigger sign-up bonuses: When JPMorgan Chase launched the Chase Sapphire Reserve®, it initially offered a sign-up bonus worth $1,500 when cardholders used their rewards points to book travel through Chase Ultimate Rewards. Other card issuers have pushed bonuses on their cards higher to remain competitive.

Redesigned “sign-up bonuses”: Instead of offering a larger initial offer, some card issuers are using bonuses to encourage cardholders to use their cards longer and more often. Discover, for instance, doubles all the rewards its cardholders earn in the first year through its Cashback Match program. BarclaysChase and American Express also have credit cards that offer bonuses that require more consistent spending.

Elite perks: More and more credit cards issuers are offering premier travel credit cards with high annual fees and elite perks. Even some cards with lower annual fees are offering better perks, such as airport lounge accessGlobal Entry and TSA Pre-Check application fee credits and general airline fee credits.

Identity theft solutions: Some card issuers are going the extra mile with helping their customers prevent fraud. Not only are they getting better at spotting and stopping fraudulent transactions, but some are also being proactive about protecting their cardholders by monitoring how their credit card number is used.

Between regulatory complexities, debt saturation, competition, and technology deficits, there is no shortage of challenges in the credit card industry. To survive and thrive, they must develop cultures of innovation and continue to churn out new ideas and approaches. For anyone who sits still very long will surely find themselves living in the past.

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