High-end credit card products are again in the spotlight as issuers have concentrated their origination efforts in these segments. This article focuses on the prestige appeal of selected products in the segment. In today’s risk averse environment, the business appeal of these cards is apparent:
“Many of the larger card issuers covet high-net worth clients because of their huge charge volume, rather than the typical finance charge revenue they might earn from the masses,” says Ben Woolsey of CreditCards.com. That charge volume can top $20,000 a month, by some estimates. “People with large charge volume generate significant amounts of interchange revenue for the issuer,” he said.
Travel-focused services and access to personalized experiences provide the primary modes of product differentiation, although the form factor appearance (carbon fiber, titanium, color, product name) certainly helps.
Mercator is currently updating its report on the premium card market opportunity and current product strategies.
