An article in Forbes takes up the question if consumers care anymore about which brand is on the front of their credit card. This query came about as Costco customers migrate from their old American Express co-branded card to a new Citi Visa card. As it turns out, consumers seemingly don’t care much about brand:
A new report by the Navy Federal Credit Union showed that most individuals aren’t concerned about the networks of their credit cards. Approximately 54% of current Visa cardholders said they don’t care about which network their next card belongs to . Only 11% said they would want a card from another network.
The 54% seem to echo similar sentiments. “It is irrelevant to me […]. It is more about the program and interest rate associated with the card”. Randy Hopper, Vice President of Credit Cards at NFCU, says ”most consumers, including Navy Federal members, care about redemption options in addition to the rewards value offered”. However, discounting card networks can lead some people to make sub-optimal choices.
Despite the lack of interest about brand, there are differences, and they should be considered:
There are some American benefits missing from the new Costco Visa card. Luckily for cardholders, Citi makes up for some of these. Amex TrueEarnings cardholders used to have access a round-the-clock 800-number they could call in the event they became stranded on the road. A concierge on the other end would locate a towing service in their vicinity and make all the necessary arrangements. This is made up for through Citi’s Roadside Assistance Dispatch services. With both benefits, the card member is responsible for the actual cost of the services rendered.
New cardholders will also no longer have access to “Amex Offers”. This list of promotions and discounts available gave members discounts on a variety of merchants and services — everything from small fast food restaurants to high-end clothing stores. According to the American Express website, card members have saved over $253M
Overview by Sarah Grotta, Director, Debit Advisory Service at Mercator Advisory Group
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