Mobile apps are up, cash back rewards are up, and competition among issuers is up. So why aren’t millennials happy with credit cards?
A new study from J.D. Power says overall, customer satisfaction for credit cards is increasing — but when broken down by age, Americans younger than 40 aren’t as happy as their older peers.
“Customers over 40 are becoming more satisfied, while satisfaction scores among customers under 40 are declining,” the study says. “Younger customers are more likely to spread spending across multiple cards and also indicate a greater propensity to switch their primary credit card.”
Basically, millennials aren’t tied down to any card or preferred usage and would rather get multiple cards with many different types of benefits, lowering use when they don’t feel like they have good benefits anymore.
But there are benefits, and J.D. Power says cash back is the No. 1 preference among all consumers. At the other end, airline miles have the lowest level of approval.
“Overall satisfaction is up across the board, and growing numbers of card companies and regional banks are coming to the market with new products that offer rich sign-up bonuses, increased cash-back rewards and new benefits,” says Jim Miller, a senior director at J.D. Power. “The key for issuers in this highly competitive marketplace is to develop strategies that increase customer satisfaction.”
Speaking of satisfaction, there is one card that rules them all. American Express took the top spot among consumer favorites. The study looked at six factors: interaction; credit card terms; billing and payment; rewards; benefits and services; and problem resolution. This year, regional credit cards were added to the study to look at the offerings of other cards that aren’t necessarily offered nationwide but consumers still use.
Credit cards are enjoying a bit of user love lately, which is good for them considering that credit card debt is one of the biggest debts Americans are paying off. If you’ve got bad credit (or no credit), there are a few different cards that help you build up a solid history so lenders don’t hate you.
Good credit usage is basically the best thing for your credit score. The Consumer Financial Protection Bureau is doing its best to make sure credit issuers and companies are treating consumers right, but that doesn’t mean you should ignore good and bad card usage.
Like if you’ve got a retail credit card, you’ve probably been charged deferred interest, which can add a hefty amount on top of your credit bill. The CFPB is urging retailers to end this and charge zero-percent interest instead. Deferred interest, or interest paid on the original amount as opposed to the final amount after a promotional period, can be offered by any issuer, but usually comes from store credit card offers.
Deferred interest isn’t great, whether you’re a credit pro or looking to build up your history. But there are other cards that might actually be certifiably the worst. Here’s to hoping you don’t have any of them.
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