When Faced with Issuer Changes, Consumers Most Likely to Spend Less with Credit Card
The economic downturn combined with revived transparency regulations in the credit card industry have caused issuers to make changes to consumers’ credit card accounts. The comScore report found that half of consumers have noticed direct changes to their accounts made by their issuer including an increase in APR/interest rate, reduced credit limit, additional fees, etc.
These changes have caused many consumers to lose confidence in their issuer and take direct action. Among survey respondents who have noted such changes in the last year, 55 percent indicated that they have decreased the amount they spend using that particular card, while 27 percent no longer use that card for purchases. Twelve percent of respondents have closed that account, while 9 percent applied for a new credit card with another issuer and 8 percent transferred their balance to another card. Just 3 percent reported spending more on that card.
“In the current economic environment, many customers are taking strong action in response to changes made by their credit card issuer,” added Mr. Levitt. "Issuers must work to provide additional value or risk consumer backlash in the form of reduced card spending or even brand defection."