The move is a desperate move to weather the economic problems of 2009. Here’s what Advanta Corp. is doing: They are closing their small-business customers’ credit cards to new charges after June 10. That’s right. If you are a small business, and if your primary business credit card is one issued by Advanta…. you are screwed. Better start shopping for a new card, because your cash flow management is about to take a major hit.
The move by Advanta will affect nearly one million accounts.
Phil Browne, Advanta’s chief financial officer, said the goal was to “maximize capital and liquidity so we have the opportunity to pursue businesses, credit cards and others, in the future.”
Maybe Advanta should have been a bit more proactive in managing their risk. The losers here are going to be the million small businesses who trusted Advanta with their business.