When it comes to credit cards, several consumer-facing articles are warning that customers should “beware the fine print” when choosing cards that offer rewards, including this one from CBSNews.com. Issuers, they say, are under pressure because it is now harder to impose fees and penalties — so new conditions to reap rewards are often hidden deep in the tiny type, including the right to take away rewards as well as hidden fees and blackout dates.
Whether or not credit card issuers need to do these things to earn a substantial profit isn’t my beef with the above: But the bad PR is. Clearly, the media is speaking loudly about the need for consumers to be aware that it’s “buyer beware” with these rewards cards — this New York Times article hit the same notes — but why isn’t the credit card industry speaking up more loudly in response, or coming up with ways to make sure consumers aren’t feeling that there’s a big catch just by applying for a rewards credit card?
The idea getting played out in the mainstream media, that issuers of rewards cards are just standing by, ready to strip consumers of their hard-earned rewards at a moment’s notice, surely isn’t a great way to increase loyalty…or enhance the reputation of credit card rewards.
Greater communication and transparency is clearly necessary — such as communicating ‘close-to’ rewards opportunities via event-triggered communiations, as well as ‘close-to’ expiring messages. And if there are terms and conditions changes that might be necessary from a business perspective, they should be communicated fully and openly and often, allowing sufficient time for customers to redeem before the change becomes effective.
The bottom line is that the reputation of rewards credit cards needs to be carefully nurtured — if a true long-term, mutually-beneficial relationship between issuers and consumers is to be continued.
