| Credit card companies fritter away in low-rate offer promotions |
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Credit card companies seem to be shelling out millions of pounds trying to lure what is the minority sections of the public who are low interest rate-chasers into using their cards with special introductory offers.
What happens to the other majority is obvious: they are simply left with unattractive and accounts. According to a Co-operative Bank research, a meager 11% of customers thought about opting for a 0% card in the coming six months and out of 10 cardholders, about 6 agreed that an introductory offer had never attracted them.
However, this doesn’t seem to have taught credit card companies offering 0% cards any lesson as they were seen squandering a whopping £53m on these card advertising and publicity campaigns in the past year, 2004.
The research further shows that a rate chaser was generally found to be a 30-40 aged male homeowner who had no dependant relatives or children to look after. Though ‘the profile of the typical rate chaser is attractive to credit card companies’ as said by Sheila Macdonald, the Co-operative Bank's Chief Operating Officer, credit card customers are now becoming increasingly aware about card offers and are therefore, not being duped into low rate offers, knowing that they are nothing but sugar coated pills.
A poll conducted on the most essential features of a credit card revealed that 77% of the consumers wanted no annual fee in their credit cards and about 64% referred to a competitive standard rate as one of the most important factors while selecting a card.
Sheila Macdonald, therefore, said that credit card companies would have to give customers clear and ‘competitively priced deals’ in the future to attract and sustain them and these low-rate opening offers were only temporary attractions that would fade out very soon.
Posted
on : Mon, 04 Apr 2005 00:00 GMT | Credit Cards News
By : Chris Rowe
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