As the recession comes to an end and consumers begin to get a hold of their finances through consolidation and credit card counseling services, creditorsare hopeful that the economy may stabilize in 2010.
Speaking at a financial services conference sponsored by Goldman Sachs, MasterCard’s Head of Core Products Tim Murphy referenced the company’s latest SpendingPulse survey that found retail spending had increased by 0.2 percent in November, according to MarketWatch.
While the data represented the third straight month of growth, Murphy said that consumers were still showing frugality due to the recession and was unsure of how long the trend would last.
Nonetheless, he felt that even with the decreased spending that 2010 would likely be an improvement over 2009.
"The worst is behind us," he said.
Speaking at the same conference, Capital One CEO Richard Fairbank predicted that consumers would continue to default on credit card payments until the late payments peak during the first quarter of 2010.
"We’re weathering the storm, but the storm is not over," he said, according to Reuters.
Fairbank also predicted that credit card delinquencies would show mixed results throughout 2010, but that defaults would eventually decline as credit card chargeoffs peak later during the year. Following their peaks, he expected most figures to stabilize for the remainder of the year.