Chase has been asking outside firms about approving co-branded card applicants it turns down, according to Wall Street Journal reporting published September 28. A Chase spokesman told the Journal the bank doesn't yet have a plan to launch a second-look program.
Both halves of that matter, so here's what's actually established and what isn't.
What a second look would be
The idea is straightforward. An applicant Chase would normally decline on creditworthiness gets passed to another lender, which decides whether to approve them and carries the debt.
The money would come from private credit. The Journal reports Chase sent inquiries to more than a dozen firms about handling second-look applications, and that private credit firms including Blue Owl, Blackstone, KKR and Sixth Street were approached about providing the funding. Those firms would take the credit risk on customers Chase declines.
Why Chase would want it
Co-branded cards are a negotiation between a bank and a brand, and approval rates are one of the things they argue about. The brand wants as many of its customers carrying the card as possible. The bank wants to control losses.
United is the partner named in the reporting. Rejection rates have been a constant source of strain in that partnership, and United had already expressed interest in finding another lender to approve customers Chase rejects. United has also made its credit card increasingly central to earning benefits and MileagePlus rewards, which raises what a decline costs the airline.
A second-look arrangement resolves that tension without Chase taking on the losses. It approves more of the brand's customers and moves the risk somewhere else.
What Chase says
This is the part to hold onto. A Chase spokesman told the Journal the bank doesn't yet have a plan to launch a second-look program.
So the reporting is about conversations, not a product. Chase talking to private credit firms about whether an arrangement is possible is a long way from a card you can apply for.
The open questions
Two gaps would decide whether this is good or bad for a cardholder, and neither is settled.
Whether applicants would know their debt was being carried by a different lender, or whether that lender would appear on the card at all. And whether a second look would be used only for creditworthiness, or would also reach rules like 5/24 and once-per-lifetime bonus eligibility.
That second one is the interesting question for anyone reading this site. If a second look only catches people declined on credit, it changes little for most readers. If it became a route around 5/24, it would change a great deal.
A third gap sits underneath both. The reporting describes inquiries about co-branded applicants without saying which co-brands, so there's no basis for assuming an arrangement would cover every partner card rather than the one or two where the friction is worst.
It's also worth being clear about who the money would come from. Private credit firms lend outside the banking system and price for risk accordingly, which is the whole reason they'd take applicants a bank declined. What that means for the rate and terms an approved applicant is offered is not something the reporting reaches.
What to do about it
Nothing, for now. Chase told the Journal it doesn't yet have a plan to launch a second-look program, so there's nothing to apply to.
The reason to pay attention is the pressure behind it. Approving more applicants is something co-branded partners push for constantly, and an airline that has built its benefits around its credit card has more reason to push than most. That pressure exists whether or not this particular arrangement happens.
If you've been declined for a Chase co-branded card recently, nothing here gives you a new route. Our 5/24 guide explains why a reconsideration call doesn't generally move a 5/24 decline.
This article contains affiliate links. If you apply through our links, we may earn a commission at no cost to you, which helps us continue sharing points and miles strategies with the community.
