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Credit card reconsideration line: What are your chances?

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You applied for a card online, only to get the dreaded “rejected” or “pending” response. There’s still another option, though – calling the issuer’s reconsideration line and pleading your case to a (hopefully) sympathetic person.

Your success with the reconsideration line will depend on the techniques you use as well as the reason you were rejected in the first place, experts say. Read on for some tips.

What is the reconsideration line?

When you apply for a credit card online, you’re first asking a computer for approval. Based on the issuer’s requirements and your credit history, the computer will spit back an almost immediate answer of “yes,” “no,” or “pending.” If you get either of the latter two responses, you can call the issuer’s reconsideration line and ask a human being to review your case.

“In layman’s terms, you can call and beg for them to give you the credit line,” says Scott Bilker, founder of Debtsmart.com.

Issuers generally don’t publicize their reconsideration line phone numbers, but they’re easy to find. The Points Guy, for example, has a directory.approved or rejected stamp

When to call

If you are turned down, the issuer will send you a rejection letter, which must state the reasons you were turned down, the credit score it used to make its decision and instructions for obtaining a free copy of the credit report it used.

But there’s no reason to wait for the letter; if the issuer’s algorithm rejects you outright, Bilker recommends calling the reconsideration line immediately.

The same rule applies if you find yourself in limbo with a response of “application pending,” says Travis Sherry, founder of the travel website and podcast Extra Pack of Peanuts.

“If you wait, you could get approved without calling,” he says. “But I just figure I’ll expedite the process, get it taken care of. I’d like to get the card as early as possible so I can start using it.”

Not all issuers will be able to help you immediately while your application is pending, Sherry says. While some will be happy to review your pending application over the phone, others will ask you to call back after they’ve reviewed your application themselves.

What are your chances?

When you call the reconsideration line, you’re not exactly in a strong position to negotiate, Bilker says. Unlike existing customers (who can negotiate terms by threatening to cancel their cards), the issuer has nothing concrete to lose by not giving potential customers (who were already rejected by their algorithm) a break.

“They might want business, but if they wanted your business, they wouldn’t have rejected you,” Bilker says. “So maybe they don’t want your business that much this time.”

That said, you still might have luck with the reconsideration line. Here are some possible reasons for rejection – and your chances of being reconsidered:

  1. You have too much credit with one issuer: If an issuer’s algorithm sees you already have several of their cards – and high limits – it may reject you outright. After all, if you get into financial trouble, you might start carrying all your debt eggs in its basket.

    Fortunately, this problem has a potential fix if you call the reconsideration line and offer to move some of your available credit from an existing card to the new one you want. That way, the issuer isn’t taking on any additional liability.

    “You’re probably going to get that to happen,” Bilker says. “You want the card to take advantage of the points, and the bank certainly wants you to use your card. And if you’re willing to give up some of your credit line [from another card], there’s no change for the issuer.”

    Sherry says he’s had success with this method, most recently when he applied for the Southwest Rapid Rewards card from Chase.

    “I asked if it would be possible to take some of the credit limit from my Chase United card and put it on the Southwest card because I wasn’t going to be flying United as much,” he says.

  2. There’s an error on your credit report: “Maybe there’s some kind of mistake, and you noticed that one of the reasons you got rejected doesn’t add up,” Bilker says.

    Sherry encountered this very scenario. When he called the reconsideration line, the representative flagged a delinquent account that had just appeared on his report.

    “So I checked my report, and there was some Verizon bill on there, and I don’t even have Verizon,” Sherry says.

    Unfortunately, this probably isn’t something you’re going to be able to clear up on the phone, Bilker says.

    “They might say, ‘Correct the error and try again,’ ” he says.

    And that’s what Sherry had to do.

    “I had to get it off my credit reports and reapply,” he says. “That kind of stinks. You have to reapply, so there’s another hard pull on your credit. And you have to wait to reapply because it can take a month to get the mistake removed from your credit report.”

  3. Your credit report is full of (true) negative information: In this situation you’re probably not going to be able to talk yourself into the card, Bilker says. And, no, a sob story and promises to improve won’t help.

    “When you’re begging, you have no bargaining power,” Bilker says. “The best thing to do, if you really want the card, is to find out the reason for the rejection and fix that. If it’s an error, fix the error. Or fix your behavior. Pay some of your balances down. And then try in the future.”

  4. You’re a student with low income: College students might have a shot if they can sell themselves to the issuer, Sherry says. Perhaps, in your initial application for a student credit card, you included your part-time job income. If you call the reconsideration line, you might talk about your scholarships, which issuers may also count as income. Adding that you’re on the honor roll, have a post-graduation job offer and want to start building your credit isn’t guaranteed to work –- but it might sway a representative. After all, hooking you as a customer early can pay off for the issuer down the road, Sherry says.

    “You want them to see you as someone who, in the future, will become loyal if they get you early,” Sherry says. “If you’re in your early 20s at this point, that could be 50 more years that you could be with them.”

Increasing your chances

Before you dial the reconsideration department, do the following:

  • Get your paperwork in order: Know which cards you have with the issuer and which cards you have in general. Sherry pulls up his spreadsheet of all his cards before calling so he can lead the conversation and suggest, for example, moving some available credit from one of his existing cards to the new one.

    “Make it sound like you know what you’re talking about,” he says.

  • Know why you want the card: Be prepared to explain why you applied for the card -– and don’t mention the sign-up bonus. Suggesting you’re going to milk the bonus and ditch the card makes you an unattractive customer. Safer things to mention include your plans to fly with the card’s affiliated airline more and use the free-checked-bag benefit.

    “Know two or three of that card’s perks that aren’t bonus related, and explain how it will fit into your life,” Sherry says.

What to do next

If the answer’s still “no,” Sherry recommends calling again.

“There have been times where I’ve called and they said they wouldn’t give me the card,” he says. “And then I called back again and got it easily. But I’d say, if you call three times and don’t get it, you’re probably done.”

Bilker, meanwhile, recommends moving on immediately –- after checking to make sure your credit report doesn’t contain any snags that would derail future applications. And, if you get another mailed offer for the same card, give it another whirl. After all, you never know:

“I’ve been rejected for cards, gotten the rejection letter, and in the same pile of mail, gotten another offer for the same card,” Bilker says. “I applied for that same card the day I got the rejection letter and got accepted. It’s hard to know exactly what’s going on back there.”


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Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Apple enters mobile payment fray with Apple Pay

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Apple has finally decided to throw its weight behind mobile payments. In its unveiling of the iPhone 6, iPhone 6 Plus and Apple Wallet, the tech giant confirmed it would be offering a mobile payment option it’s calling Apple Pay, starting October 2014.

Apple Pay: The low-down

Apple Pay will be built into the iPhone 6, iPhone 6 Plus and Apple Watch.

photo of apple payIn short, you’ll be able to add your payment cards to Apple’s Passbook. If the store you’re shopping at has terminals enabled with near field communication (NFC), you can select the card you want to use, hold your device a couple inches from the terminal and complete the purchase with Touch ID (which verifies your identity via your finger print).

Now let’s zoom in on some details:

  • Apple Pay uses NFC technology: NFC is often described as “tap-to-pay” technology. It works with any devices that contain NFC chips — phones, payment cards, hotel key cards and a slew of other things. Whenever the NFC-enabled device is in close proximity to the reader, the device and reader communicate wirelessly. In the case of mobile payments, the phone communicates with the payment terminal, and the payment is charged to the card you’ve selected from your digital wallet. Before the iPhone 6, iPhones couldn’t be used for NFC contactless payments (unless you had a special NFC case); the technology was available only on devices running Android or Windows operating systems. Notable pioneers of using NFC for mobile payments are Google Wallet and Softcard (formerly called Isis).

    Encrypted card information will be housed in a secure element, a chip within the iPhone 6 and Apple Watch. This makes Apple Pay’s NFC different from the variation Google Wallet is using. Google Wallet uses host card emulation, which stores encrypted card info in the cloud. Backers of secure-element hardware for NFC (including Softcard, which uses a secure-element SIM card) argue it’s more secure, and it seems Apple agrees.

  • Adding cards: You can get started with whatever card you already have in your iTunes account. If you want to add more, you can photograph the physical cards in your wallet with your phone and add them to Passbook.

    Apple has partnered with Visa, MasterCard and American Express (a CreditCardForum advertising partner), as well as a number of issuers that it says make up 83 percent of credit card purchase volume. Those issuers include Citi, Bank of America, Capital One, Wells Fargo and Chase. PNC, Barclays, USAA and more are scheduled to be added.

  • NFC symbolWhere you can use it: You can use Apple Pay at any stores that already have NFC terminals — that’s any terminal displaying the symbol to the right.

    In-store NFC technology is nothing new, but Apple Pay goes a step further by integrating itself with various other mobile apps. This means an Apple Pay button will appear when you’re using a partner app. For example, you can use it to order an Uber car or pay the check via OpenTable. It will also be built into various companies’ online shopping apps, so you’ll be able to check out with one tap via Touch ID without entering your card number.

  • Touch IDSecurity features: The first layer of security is the fact that Apple Pay uses Touch ID. Your phone can make sure it’s really you making the payment – not a thief (who would obviously have a different finger print).

    Second, card numbers themselves are not stored within the secure element. Information is encrypted into a “Device Account Number.” So, if your phone is stolen, in theory, you won’t have to cancel cards.

    Finally, when you buy something, the payment is processed with that Device Account Number as well as a dynamic security code unique to the transaction. Dynamic transactional data is also what makes EMV payments secure – and what makes it more difficult for thieves to clone cards from information stolen in a data breach.

Can Apple Pay beat the competition?

During the product unveiling, Apple CEO Tim Cook made it clear what Apple is out to do.

“Our vision is to replace this,” he said, referring to the wallet.

But Apple isn’t the first to try. Mobile wallets have been around for several years. Google and Softcard went the NFC route, while others (like PayPal and Square Wallet) side stepped NFC entirely by allowing customers check in with their phones and open a digital tab whenever they entered a business. Wal-Mart, meanwhile, rejected NFC outright, vowing to create its own mobile payment solution with other merchants.

Yet Cook had some fighting words for those who have come before, saying their mobile payment solutions have failed to reach critical mass because they were blinded by “self interest” and “tedious at best.” Whether that’s a fair assessment is up for debate. But Apple made a calculated move to wait for its competitors to jump in first (in fact, it surprised many by snubbing NFC in 2012 with the iPhone 5). Here are some reasons that wait-and-see strategy might pay off:

  • Interest in mobile payments is growing: Although mobile payments have yet to hit critical mass, the technology has demonstrated potential for growth. According to March 2014 data released by the Federal Reserve, 17 percent of all smartphone users have made a mobile point-of-sale purchase in the past 12 months (up from just 6 percent in the previous year’s report).
  • EMV migration could encourage upgrades: Migration to EMV gives merchants a reason to update their equipment. While not all EMV-compatible terminals have NFC capabilities, many do. In fact, several major payment processors are pushing “future proof” terminals that incorporate both technologies.
  • Apple has a ton of cards on file: Apple has 800 million credit cards on file for iTunes, according to Business Insider. Rather than having to add cards to a mobile wallet (a hurdle some may not want to clear), Apple can seamlessly allow consumers to use the cards they’re already using for iTunes. Plus, Apple’s large customer base may help Apple Pay to quickly scale where other mobile payment ventures faltered. Square, for example, ditched its mobile payment app entirely in May 2014 after failing to get enough merchant and consumer adopters.
  • The watch could bolster adoption: Apple Watch becomes available in early 2015 – right on the heels of Apple Pay. People who are comfortable wearing a device that measures their heart rate and reminds them when they’re near something they’ve pinned on Pinterest is probably technologically adventurous enough to use the watch to pay for coffee.

Those advantages aside, it will be interesting to see how Apple Pay competes – and coexists — with other options. PayPal has been retooling its mobile payment app and is rumored to be incorporating Bitcoin mobile payments. Starbucks has had success with its own mobile payments app based around its loyalty program. Softcard and Google Wallet offer other NFC options. And remember Wal-Mart’s promise to create a non-NFC mobile payment option? Just last week, it announced CurrentC, a mobile wallet and loyalty payment option that avoids NFC (transactions make use of scanned codes) and is scheduled to roll out at big-box pharmacies, convenience stores and retailers in 2015. In fact, CurrentC partner retailers have been rumored to be switching off their terminals’ NFC capabilities.

It will also be interesting to see how Apple plans to make money from Apple Pay. Rumors are swirling that that it negotiated a rebate on the interchange fees issuing banks collect from merchants’ banks, but those details remain secret. It’s also entirely possible that Apple Pay will initially act as bait to get people to switch to the pricier iPhone 6.

So are mobile payments finally going to take off?

Phones that enable mobile payments (which have already existed for several years) aren’t enough to make credit cards go extinct. There have to be more advantages to consumers and merchants than speed. As much as Cook tried to make audiences think otherwise with a humorous video showing how cumbersome card payments are, in reality, mobile payments save a few seconds at most. Apple pay in apps

That may not be enough to justify the hurdles of trying a new way of paying – and eschewing your wallet for something that could run out of batteries. And indeed, as CreditCards.com found in a recent survey, there’s significant adoption reluctance: More than 40 percent of respondents said they’d “never” use their phones to pay for items.

But Apple is doing some things that could lower that reluctance. Apple Pay is built into the phone and the watch that people will be lining up down the block to get. There’s no requirement to download an app, and, if you already have a card tied to your iTunes account, you don’t have to add any other cards. The second you get your phone or watch, you can use it to pay.

Then there are those partnerships Apple has with mobile commerce apps. When consumers use those apps for ordering food and shopping online, they’ll often find that Apple Pay has already been integrated (see the image above). That could win some adopters — and continue Apple’s pattern of intertwining various features so that new things surreptitiously become familiar and indispensable.


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Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

American Express Car Rental Discounts & Deals

Posted by CreditCardGuru on

Even if you got a good deal on your flights and hotels, the daily cost of renting a car can inflate the cost of your trip. It can also inflate your stress levels as you wait in long lines to get your keys.

This is why it’s now more important than ever to take advantage of every discount and promo code you can get — or at least try to squeeze some extra rewards out of car rentals. The rental discount programs offered by American Express (a CreditCardForum advertising partner) are one way to do this.

Here’s a review of the various AmEx car rental deals available as of 2014. Please note that these are subject to change without notice, which is why you should always check and confirm a discount is still valid with American Express customer service.

Discounts for American Express Open Savings (on business cards):

Hertz Rent-a-Car

  • If you spend up to $500 annually on your account, you will automatically save 3 percent OR get 1 extra Membership Rewards point per dollar.
  • If you spend $500 to $2,000 annually on Hertz car rentals, you will automatically save 5 percent OR get 2 additional Membership Rewards points per dollar.
  • If you spend more than $2,000 annually at Hertz, you will automatically save 10 percent OR get an extra 4 Membership Rewards points per dollar.

Don’t have an Amex business card? Then I highly recommend checking out my American Express Simply Cash review (no annual fee with excellent cash back and benefits).

Elite status with Hertz, Avis and National with AmEx Platinum and Business Platinum:

The annual fee on the American Express Platinum may seem steep. But if you do a decent amount of traveling, the money and time you will save with the card’s benefits can help justify paying more up front. When it comes to car rentals, here is what the card will give you (in addition to any applicable Open Savings if you have the business version of the Platinum):

American Express car rental privileges

Normally, to get elite status with those companies, you’d have to use them frequently. But having a Platinum American Express card gets you into three major car-rental loyalty programs right off the bat. Look into each program for specifics, but some benefits you can expect include discounts, upgrades and the ability to skip the line at the counter.

If you’re interested in finding out more information, you can check out our sponsored offer for the AmEx Business Platinum Card

Double Membership Reward points through American Express Travel:

Do you have an American Express that participates in the Membership Rewards program, such as the Green, Gold, or Platinum charge cards? If so, book your car rental using the American Express Travel website and earn double points.

list of rental companies which earn double membership reward points
As you see, a lot of major car rental companies participate, including Enterprise, Alamo, Payless, Thrifty, Budget and others. Don’t have a card with Membership Rewards? Then I recommend checking out these reviews of the American Express Premier Rewards Gold or Platinum Card.

Car rental discount at Dollar:

Dollar Rent A Car occasionally features “Partner Special Offers” from various companies, including American Express. Here is a recent screenshot from the Dollar car rental website (as an example only, since these offers change frequently):

Dollar rental American Express Discount

Car rental deals at National:

If you rent from National you may be able to snag some great discounts thanks to your American Express card. Check the National car rental website to see if there’s anything being offered. Here is a recent example (check with National for current offers):

National Car Rental American Express deal

Conclusion?

As you can see, there are quite a few ways to score an American Express car rental discount — or at least some extra perks. The best part: some of these discounts are streamlined to the point where you just need to use your card for your rental — no hunting for coupons.

Last updated Sept. 3, 2014


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Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Citi Double Cash card review: What makes it different?

Posted by CreditCardGuru on

Cards without annual fees that let you earn more than 1 percent cash back on every single purchase across the board are pretty uncommon. But Citi just launched a new product that promises to give you 1 percent when you buy something — and another 1 percent when you pay for it.

The Citi Double Cash card offers a unique way to earn “double” cash back on all purchases. Here’s how it works and how it compares to the competition.

How you earn the extra cash back

With most cards, you earn rewards as you make the purchase. Say you have a card that gets you 2 percent back on dining. You eat at a restaurant, pay with your card and, as soon as that purchase is posted to your account, those rewards are yours.

Citi’s Double Cash card works a bit differently. When you pay with your card (for any purchase), you get 1 percent back right away. Want those extra rewards the card offers? You need to pay your card balance on time. Once you make a payment (whether you pay in full, or just the minimum), you get an additional 1 percent back on the amount you pay.

So, it’s not always accurate to call this a 2-percent-cash-back card. For one thing, you’re sacrificing that second round of cash back if you fail to pay on time. Plus, if you redeem your rewards for a statement credit, it will reduce the amount you owe by 1 percent and, thus, the amount you can earn rewards on when you pay the rest of the bill. Still, the card gives you the chance to earn more on your “everything else” purchases than any other no-annual-fee cards offer. Before this card, the Capital One Quicksilver offered the highest rate of cash back on all purchases among no-annual-fee cards — 1.5 percent.

You can redeem your rewards for a statement credit, cash back (check) or gift card (for a minimum of $25).

Benefits

EMV chip: As an added perk, this card has an EMV chip. It seems like every new card these days is sporting one, but no-annual-fee cards that have an EMV chip are still in the minority.

The EMV chip will allow you to use your card overseas in many cases where magnetic stripe cards aren’t accepted. However, the card unfortunately has a 3 percent foreign transaction fee, meaning it might not be the best choice for purchases abroad. With the U.S. migrating to EMV, though, the card should be increasingly handy state-side over the next few years.

Citi Price Rewind: This benefit (offered on several other card’s in Citi’s portfolio) allows you to monitor price fluctuations after you buy an item. If the price drops within 60 days, you might be eligible for a refund of the difference (up to $300 per item and up to $1,200 per year).

Purchase protection: If an item you bought was stolen or damaged within 120 days of purchase (or 90 days if you’re a New York resident), you can be refunded for up to $1,000 per item.

Extended warranty: If you turned down the extended warranty when you purchased an item, you might regret that decision if the item breaks. This card adds up to an extra year on warranties of five years or less for no additional cost.

Travel protections: You get secondary car rental insurance, trip cancellation and interruption insurance (up to $1,500 per year), and travel accident insurance (up to $250,000).

Citi Private Pass: The Double Cash card gets you access to preferred and presale tickets, as well as access to special events.

What to watch out for

If you carry a balance on the card, that extra 1 percent you get when you pay will be cancelled out by interest. So, while you can earn extra rewards by paying only the minimum, you’re still coming out behind. To get the full potential double cash back reward, you will have to pay your balance in full every month before the due date.

But that’s really no different any rewards card; paying interest cancels out your rewards, across the board, plain and simple. The plus side of this card is that, because you don’t get the extra 1 percent until you pay, there’s an added incentive to pay – and possibly make larger payments or pay in full. If you’re the type to do that anyway, you might not care. But tying rewards to desired behavior could help those who require a little extra motivation.

The competition — what else is out there?

If you want to earn a full 2 percent cash back, there are ways to do that. The Barclaycard Arrival Plus World Elite MasterCard, for example, offers 2.2 percent back on all purchases – but for an annual fee of $89. The only other card without an annual fee that gives 2 percent back on absolutely everything is the Fidelity card from American Express (a CreditCardForum advertising partner). However, you have to have a Fidelity account to get the card.

Also keep in mind there are other no-annual-fee cards that offer 5 percent cash back in certain categories (the Discover it and the Chase Freedom. Depending on your spending, those cards might net you more rewards overall. However, you need to enroll in quarterly categories to get 5 percent back — and those categories have spending caps. The ideal strategy, therefore, might be to combine the Double Cash card with a card that offers elevated category spending. That way, you can get extra cash back within the categories and use the Double Cash for all other spending (and for category spending after you hit your limit on the 5 percent card).

The bottom line: The Citi Double Cash card is likely the easiest way to get a steady higher-than-usual rate of cash back on absolutely everything with no cover charge. It would work well on its own (if you don’t want to mess with chasing rotating categories) — or as a good sidekick to a rotating-category card. Still, keep in mind that things do change, and Citi has, in the past, offered especially lucrative rewards on a card and then pared them back, as some of our forum members are pointing out, citing the Dividend Platinum Select as an example. In addition, during the cards first days, Citi cardholders have been reporting problems product-changing to the Double Cash.

This review was written or last updated on Aug. 28, 2014.


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Editorial Disclosure: The editorial content on this page is not provided by any bank, credit card issuer, airline or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

American Express and Discover tie for first in credit card satisfaction study

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It’s been a bumpy year in the relationship between consumers and their credit cards, thanks to a stream of high-profile data breaches. Yet consumers are happier with their card issuers than ever, according to the J.D. Power 2014 U.S. Credit Card Satisfaction Study. stack of credit cards

Average satisfaction across the credit card industry has hit a record high of 778 points (out of a possible 1,000). That’s up from 767 in 2013 and up 10.6 percent from 2009′s recession-related dip.

Those who have American Express (a CreditCardForum advertising partner) and Discover cards are particularly pleased with their cards, the study found. It also found that issuers’ responses to fraud and security breaches influence consumers’ satisfaction.

American Express and Discover tie at the top

American Express has occupied the top rung since J.D. Power started doing the annual study in 2007. It didn’t slip this year, but it’s now it’s sharing the top spot with long-time second-place finisher Discover. J.D. Power’s Satisfaction Index weighs six factors (interaction, card terms, billing and payments, rewards, benefits and services, and problem resolution).

Here are the 2014 rankings:

2014 J.D. Power Customer Satisfaction Index rankings
American Express819
Discover819
Chase789
INDUSTRY AVERAGE778
Barclaycard776
U.S. Bank773
Wells Fargo773
Bank of America766
Capital One765
Citi756
GE Capital Retail Bank739

It’s interesting to see Discover and American Express sharing first place, says Jim Miller, senior director of banking services at J.D. Power, because they have such different business models. American Express has a more affluent customer base and offers a complex array of cards with different types of rewards and a range of annual fees. Discover, meanwhile, has a broader customer base and simpler reward programs that are focused on cash back and no annual fees. What both have in common, though, according to the survey, is a dedication to customer service.

“That shows you can have high satisfaction through the strong execution of very different business models,” Miller says. “There’s more than one path to the top.”

Chase has been the “biggest mover” over the past several years, Miller notes. It’s climbed from seventh place in 2009 to solidify its three-year hold on third place.

As for the rest of the pack below the “industry average” bar, some have seen bigger increases in satisfaction this year than American Express and Discover have. Still, ending the Discover-AmEx dynasty will be a tall order in an industry that isn’t known for frequent, drastic, game-changing innovation. Issuers that score the best do so because they’re excelling in all of the categories the survey looks at – not because they’ve unveiled any secret weapons that blow away the competition.

“There’s not a really easy way to make a big jump,” Miller says. “But everybody in the study, if you go back four or five years, has gone up significantly.”

Overall satisfaction high

Average JD Power index score chart
The graph to the right shows the industry average Satisfaction Index ranking over the eight years J.D. Power has performed its annual study.

A couple factors have been fueling the upward trajectory since 2009, Miller says.

For one thing, the economy is improving.

“With credit cards that makes a big difference,” Miller says. “When people are feeling better about their financial situation, they’re feeling much better about being able to pay off their credit card or at least keep up with payments.”

Another possibility? Rewards are getting better — and more transparent.

“This is a really competitive industry, and from a consumer perspective, it gets better year after year,” Miller says, pointing out that getting 1 percent back on spending was considered good not too long ago. Now, it’s not hard to get 2 percent back, or more in certain categories.

Issuers, Miller says, are also making an effort to help consumers get the most out of their rewards. This year’s survey found an uptick in consumers who say they “completely” understand how to earn rewards (63 percent his year, vs. 59 percent in 2013).

“The focus on benefits and rewards used to be about getting you to sign up, and issuers weren’t as focused on getting you to use them,” Miller says. “But more and more, they’re finding that getting cardholders to use benefits and redeem rewards creates loyalty.”

Turning data breach lemons into lemonade

The most common problem consumers have with their cards, according to the survey, is unauthorized and fraudulent activity, accounting for 21 percent of the problems reported by survey participants. Yet instead of eroding consumers’ satisfaction, this has given issuers a chance to prove themselves to their cardholders.

The issuer’s response to a data breach can make the difference between disgruntled customers and happy (or at least understanding) ones. What consumers don’t like: getting a data breach notification letter and nothing else. That drops the satisfaction score to an average of 734.What they do like: getting a notification, getting a new card from the issuer and receiving email alerts. That raises average satisfaction to 835.

Replacing cards is a hassle for consumers (and has costs for issuers), Miller says. But consumers who feel taken care of tend to feel that issuers “are looking out for their best interests,” he says.

With EMV technology making headlines as a security improvement (and an antidote to retailer data breaches), does that mean consumers will be more satisfied with issuers that roll it out quickly – and less satisfied with the stragglers?

Not right away, Miller says, as so few U.S. merchants accept the technology. Frequent international travelers aside, magnetic stripe cards, for the time being, work just fine for most consumers.

“I think there’s a marketing element there [for issuers], Miller says. “But EMV doesn’t benefit customers right away. … When we reach the point where it’s more of a hassle to swipe the card [rather than insert it in the chip reader], there probably will be more pressure. You don’t want to be the last one swiping and having the merchant give you a hard time about it.”

Other study highlights

  • Satisfaction may be high, but 10 percent of consumers switched their primary card in 2014. Among those consumers, 42 percent did so for a better rewards program.

    “Offers to sign up [for new cards] are getting so rich that even satisfied customers are tempted by other offers or something that’s more tailored to them,” Miller says.

  • Satisfaction is all about communication, communication, communication, the survey found. Emailed service alerts (informing cardholders about when payment is due or when a payment is received, for example), increased satisfaction by 76 points. Satisfaction among customers who use mobile banking (which allows for increased contact) was 54 points higher than among customers who didn’t.
  • Issuers are actively trying to improve their reward programs to keep customers. In the 2014 survey, 19 percent of customers said their reward program’s value had improved over the year, an increase from 17 percent in 2013. Improvements might include streamlining rewards programs or making it more convenient for customers to redeem rewards (via online shopping, for example), Miller says.

About the study

The 2014 U.S. Credit Card Satisfaction Survey included responses from almost 20,000 cardholders. Results were released Aug. 28, 2014. The survey was conducted between September 2013 and May 2014.


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