[jasper_platz]

we are planning to be pretty good about managing our risk :) but more importantly credit card debt isn't "bad debt" at all. most folks think that. there is about $700B of credit card debt of which about half is held by large pensions funds etc. and none of that paper defaulted in the financial crises.

[screature2]

My understanding is that Credit Card ABS are kept at very good ratings via careful division and securitization of the credit card receivables into different tranches of risk and corresponding priority for repayments (specifically so that pension funds and investors of that ilk can invest).

The fact that none of those securities defaulted during the financial crisis, doesn't mean that none of the underlying credit card receivables were written off or otherwise defaulted on.

Seems that the parent comment's premise is essentially correct, you guys are going to be handling some portion of those credit card receivables and are betting that you can cherry pick or otherwise attract the safe/good/profitable portion.

edit I realize that this comment probably comes across a fair bit more pessimistic than I intended. Actually, I think that this is a pretty decent bet. Pretty sure they're right about the existence of a class of cardholders who choose to carry a balance for convenience or short-term need rather than long-term circumstances or irresponsibility. Not sure what the TAM is on that, but definitely sounds like it's a hypothesis worth following up on.