Wall Street’s largest banks are pulling back on new credit card approvals, cutting off access for many Americans during Donald Trump’s first full year back in the White House. Earnings released by major card issuers showed that total new credit card accounts fell by 5% in Q2, the first drop in over a year. Executives from JPMorgan Chase, Citigroup, Capital One, and American Express all pointed to a clear reason: tightening requirements, especially for lower-end customers. These banks are turning away applicants they see as higher risk, mostly people with lower credit scores or less financial flexibility. They’re adjusting who gets to be a cardholder and leaning harder into the wealthy segment of their user base. This selective approach is becoming more obvious as premium products get the spotlight and mass-market offerings take a back seat. Banks tighten approvals for lower-income consumers Capital One CEO Richard Fairbank told analysts this week that the “highest, fastest-growing part” of the company’s card business has come from “heavier spenders.” Last month, his firm opened a new luxury airport lounge at JFK in New York, reserved for holders of its $395-a-year Venture X card. That lounge includes a cheesemonger station. This focus on premium isn’t limited to Capital One. Both JPMorgan and Citigroup rolled out upgraded high-end cards in recent weeks, while American Express said it plans to update its Platinum card later this year. But while perks go up at the top, access is shrinking below. The Federal Reserve’s Senior Loan Officer Survey reported that more banks increased credit card approval standards than eased them in 2025. American Express revealed a 6% drop in new account openings compared to last year. Still, the company reported that the average annual fee per card rose from $101 to $117, pointing to higher adoption of its premium products. The bank isn’t alone in zeroing in on high-income applicants. That strategy includes more aggressive targeting. In April, more than 87% of card-related mail was prescreened, meaning offers were sent only to consumers who already passed certain credit score checks. It’s the highest such share since 2022. Megan Cipperly, vice president at marketing analysis firm Competiscan, said the volume of offers has narrowed to a specific group. “Only a small subset of consumers are receiving the lion’s share of credit-card offers, and they’re not necessarily the ones who need more credit,” Megan said. She noted that consumers with excellent credit scores account for less than 25% of the credit-card market, but they’re getting the most attention. Banks are going after this group hard because they swipe often and pay on time. Every swipe brings the bank an interchange fee, and high-score users usually clear their balances monthly, keeping defaults low. At American Express, flat overall airline spending disguised a deeper trend. Travelers in economy weren’t spending more, but spending on first-class seats rose 10%. On top of that, short-term rentals over $5,000 rose 9%. The premium customer base is growing and spending big. Low-income cardholders struggle as costs climb While high earners drive revenue, the rest of the market is showing signs of stress. Card balances are increasing. That’s a red flag. It means many households are spending more than they can afford. On top of that, credit has gotten even more expensive. The average interest rate on credit cards hit 24.35% this month, based on data from LendingTree. Despite the pressure, delinquency rates have stayed steady. But banks remain cautious. Speaking during JPMorgan’s earnings call, CEO Jamie Dimon said, “The U.S. economy remained resilient in the quarter.” Still, Jamie made it clear that “significant risks persist.” The overall picture is simple. Trump is in office, and under his economic leadership, banks are becoming more conservative with lending. Wealthy Americans are still spending, flying front-of-cabin, and booking luxury rentals. But millions of other Americans are being quietly shut out. If you don’t have excellent credit, don’t expect a welcome letter from a bank anytime soon. KEY Difference Wire helps crypto brands break through and dominate headlines fast
