Solutions To Credit Card Debt

Many people, who advocate using credit cards, mention the benefits and convenience that results from using them

. However, there is another current of thought that opposes using them.. The primary reason is that it creates excessive credit card debt, which has become one of the most serious problems faced by the credit card holders and credit card industry. However, you can't completely eliminate their use as a result of a few irresponsible people (or even its more than few). That is not the ideal solution for overcoming excessive credit card debt. Moreover, you cannot overlook the benefits afforded with the use credit cards. The issue of excessive debt can be looked at from different perspectives. First is examining the excessive credit problem at the provider level and second is the addressing of the addressing credit card debt problem at the individual level. The first method involves increasing knowledge of excessive credit card problem an the affect it has on consumers. To a certain extent its being done currently. However, there should also be a concerted effort to tackle this problem on a even deeper level. This entails trying to devise a mechanism to control the potential problem at the issuer level before it affects the consumer. This approach should actually be a part of the overall system that limits the amount of credit issued. A lot of thought needs to go into devising such a mechanism. Studies should be performed, statistics gathered and analyzed and a proper forum formed comprised of both consumers and issuers. Currently, the credit card issuers appear to be satisfied in coming out with new products and having customers enroll to them. There is little attention paid towards addressing the issues of excessive credit. Attending a mandatory seminar could potentially be made part of the credit card application process. An additional method of dealing with the problem could potentially be developing a floating mechanism for calculation of applicable credit card limit at the individual level. With this approach there could be mechanisms for proactively the users of reaching excessive levels or limits of debt. There would exist possibility of creating early restrictions on noticing the first signs of trouble. Such a system would be beneficial both the consumers and credit card issuers.

On an individual level, the treatment of the problem of too much debt can include following strict practices usage and buying things that necessary at the time. A checklist or questionnaire could be given to individuals to help become cognizant the early stages of excessive debt.

The problem we encounter today with debt will require combined efforts by consumers and credit card companies

by: Mimi East

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