Card firms 'encouraging customer loyalty'

Fri 4 Jan 2008 12pm

Credit card companies are likely to be offering extra services to ensure customer loyalty as the industry goes through a difficult time, according to a representative of banking at Defaqto.

Principal consultant David Black has praised an initiative by Capital One, which offers free email alerts from Equifax notifying customers of key changes, unexpected credit applications and two free credit reports per year.

Mr Black explained: "The rationale is simple: encourage credit card loyalty by offering something worthwhile as a possible prelude to the later introduction of annual charges."

With 71 per cent of credit cards offering zero per cent introductory balance transfer schemes, the importance of customer satisfaction has been highlighted in what Mr Black described as "testing times" for providers.

Research by Abbey Banking has revealed that more than three billion people are planning to switch balances on their credit cards in the early stages of 2008.

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