What is Cards in Circulation?
What is Cards in Circulation?
What is Cards in Circulation?
Although there many other statistical information, in this article I will touch on these two topics.
CIC is one of the most important key indicators used in managing credit card business. When an expert mentioned having a CIC of one million in the country, it simply means they have 1 million good cards (excluding cancelled ones) circulating in the country. The CIC number includes primary and supplementary cards. If a person has 5 credit cards in his possession, the CIC would takes in all the 5 in its count.
All companies used the same formula to compute the CIC. The following is an example how this formula is used:
Example: Since day one, a company has issued 1 million cards. Out of it, 100,000 have been cancelled either voluntary or involuntary. Out of the 100,000 cancelled ones, 10,000 were successfully reinstated.
Working out the CIC:
Total New Issuance: 1,000,000
Less: Total Attrition: 100,000
Add: Total Restatement 10,000
Card-in-Circulation (CIC) 910,000
If the CIC is mentioned over a specific time period such as in a year, new columns for Beginning CIC, new card acquisition and Ending CIC will be added to make it more meaningful. Continuing from the above example, let say the company has entered into a new year and during it, the company has acquired additional 200,000 new cards, experienced 9,000 and 1,000 cancellations and reinstatements respectively.
The new CIC will be computed and presented as follows:
Next Year
Beginning CIC 910,000
Add: Total New Acquisition 200,000
Less: Total Attrition 9,000
Add: Total Reinstatement 1,000
Ending CIC 1,102,000
Other statistics that the company tracks are total numbers of card renewed, total number of cards converted out and converted in. These statistics do not impact the computation of the CIC but they are important numbers to track on.
Card statistic is one of the most important key indicators tracked by the companies. The statistic helps the companies to plan its business strategies and directions. Collecting and comparing such statistics with rival companies, shows where the one stands in industry of the country.
Some companies who have a small CIC cleverly hide their shortcomings by announcing total number of card issued rather than CIC as the former includes good and bad cards added together.
http://www.cardexpert.org
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