U.S. Banks Tighten Credit Card Approvals, Shift Focus to Premium Segments

Major U.S. banks reduced new credit card approvals by 5% in Q2, marking the first decline in over a year. JPMorgan Chase, Citigroup, Capital One, and American Express attributed the drop to stricter requirements, particularly for lower-income customers. The trend reflects a strategic pivot toward wealthier clientele, with banks actively discouraging higher-risk applicants.

Capital One CEO Richard Fairbank emphasized the growth in premium cardholders, citing heavy spenders as the fastest-growing segment. The company recently unveiled a luxury airport lounge at JFK, exclusive to holders of its $395 Venture X card. Rivals like JPMorgan and Citigroup have similarly rolled out upgraded high-end offerings, while American Express plans a refresh of its Platinum card later this year.

This shift coincides with broader tightening in consumer credit. The Federal Reserve's Senior Loan Officer Survey confirms banks are increasingly selective, leaving mass-market products sidelined as premium perks take center stage.