What credit card issuers can do as dissatisfaction with rewards rises
Credit cards have become important for many Americans' financial survival, as they contend with the pressure of higher prices. Their growing level of debt is, in turn, undermining their satisfaction with rewards programs — which are a key competitive factor for card issuers working to build and maintain market share. More consumers could end up shopping around for better deals, including more generous cash back rates. Here’s a look at consumer satisfaction with credit cards, along with tactics card issuers are using to make their rewards programs stand out and some ideas about what else they should consider.
More than any other factor, rewards programs for credit cards drive usage and interest in signing up for new accounts. But research by J.D. Power indicates that rising credit card debt and the continuing deterioration of consumers’ overall financial strength have tainted how satisfied people are with their card rewards.
Among the seven factors that the research covers to assess overall satisfaction with cards, the rewards people earn came in dead last.
The annual study separated satisfaction with rewards earned from satisfaction with rewards redemption for the first time. The latter scored higher.
Getting a handle on any dissatisfaction with rewards is critical to issuers because, as J.D. Power found in its 2023 U.S. Credit Card Satisfaction Study, the leading reason why consumers switch to a new card is to enroll in a better rewards program.
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