AT&T; Universal Card Services Corp. told "a significant number" of its customers it is cutting their Universal Card interest rate to 13.9% from 18.15%. AT&T;'s move comes a month after the credit card unit surprised Wall Street by reporting a $35-million operating loss for the third quarter, contrasted with a $47-million profit in the year-ago quarter. The credit card unit has an unusually high number of customers--about 60%--who pay off their bills every month and thus pay no interest. A spokesman wouldn't say how many cardholders got the offer or what criteria were used. The company hopes the lower rate will encourage higher card usage so the company can make up in volume what it loses in profit margins.
Times Staff and Wire Reports
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