Forget "buy now, pay later." The Delaware bankers who set the nation's credit-card rates have slowed the flow of easy money that once kept the U.S. consumer economy afloat.

The Federal Reserve said yesterday that "revolving credit," the money owed by Visa and MasterCard users to their banks, fell to $906 billion in July, from a peak of $975 billion in June 2008.

That $69 billion drop reflects those borrowers who've paid off their debts, as well as a growing number the banks don't expect to pay them off.

There are signs of bigger cuts to come. The nation's two largest credit-card banks - Bank of America Corp.'s FIA Card Services N.A. (formerly MBNA) and JPMorgan Chase & Co.'s Chase Bank USA N.A. - have drastically cut "unused credit lines" in the last year, according to Federal Deposit Insurance Corp. records.

That means consumers will be able to borrow less this Christmas shopping season before they can max out their Visas or MasterCards.

Bank of America cut unused credit-card lines to about $600 billion, a sharp drop from $950 billion a year earlier. At Chase, unused lines fell below $600 billion, from more than $700 billion.

Many borrowers never reach their card limits. But the banks aren't running the risk that more will be tempted to try. Both Bank of America and Chase reported losing money on credit cards in the first half of 2009, reversing the previous year's profits.

Besides reducing borrowing limits, credit-card lenders are also ratcheting up interest rates - to a median 14.4 percent in the second quarter, more than a percentage point above last year's lows, according to the Fed.

By comparison, home mortgage rates have remained below 6 percent for most of this year, a full percentage point below last year, according to HSH Associates of Pompton Plains, N.J.

Why did credit-card rates rise while mortgage rates fell? The federal government has helped finance more low-cost mortgages to stimulate home buying. By contrast, Congress passed legislation, which started taking effect this summer, to make it more difficult for card lenders to boost rates in the future. The banks grabbed what they could when they could.

Card banks' problems are becoming the Philadelphia area's problems: BofA's credit-card unit cut 2,500 jobs over the last year, leaving 26,200 workers in Wilmington and other bank sites around the country. Chase cut 800, leaving about 18,400.

Online scale

Michael G. Rubin, chief executive at GSI Commerce, King of Prussia, says that the national slowdown is reshaping the online-retailing business, where demand remains stronger than at "brick-and-mortar" stores, but that cost pressures are growing.

GSI handles online shopping orders for Toys R Us, the NFL, Dick's Sporting Goods, Estee Lauder, Ralph Lauren, and other national retailers.

"The top 500 online retailers are growing nicely; the small are becoming irrelevant," Rubin said. "It's an economy of scale." Amazon.com has trained customers to expect quick, free, or cheap home delivery. "Small firms can't do that."

GSI's order-fulfillment division employs 4,000 at a warehouse complex in Kentucky and at sites in Canada, the U.K., and other countries. Rubin figures GSI makes 8 cents to a dime of profit on every dollar of revenue it brings in from online sales.

Its other business line, online-marketing services, employs 600 helping firms reach would-be customers; it's more profitable, earning about 25 cents per dollar of sales. GSI took on 50 people earlier this week when it bought Pepperjam, a Wilkes-Barre online-ad-software firm, for an undisclosed sum, to add to the marketing unit.

It passed another milestone when a main long-term investor, Softbank Inc., unloaded its GSI shares as part of a $230 million-plus secondary stock offering last month that included $88 million in newly issued share sales.

The sale made GSI attractive to institutional investors by putting more shares on the market, according to Rubin. John Malone's Liberty Media (which also owns QVC of West Chester) and Rubin are GSI's largest investors.