NEW YORK—Is the credit card war de-escalating?
As CUToday.info has regularly reported, credit card issuers have for years been in a game of escalating one-upmanship when it comes to card benefits. But a new report suggests the battle that heated up near the end of the pandemic is fading.
Kiplinger reported that higher interest rates, inflation and other pressures have led card issuers to cut back on some offers.
“That means many credit cards have reduced the points or miles sign-on bonuses, or provide fewer months of no-interest charging or balance transfers,” Kiplinger said.
Over the past few weeks, many cards have decreased the amount of time for balance transfers promised to new cardholders, Kiplinger said.
“Cards that offered 21 months now may offer 18, while those that offered 18 now offer only 15. The BankAmericard credit card, for example, reduced the 0% balance transfer period from 21 months to 18 months,” Kiplinger said.
Changes in 0% Offers
Turning to 0% for purchases, Bank of America’s Custom Cash card used to provide 18 months of 0% APR for purchases, but now only offers 15, Kiplinger noted.
“If you search the internet for credit cards offering 21 months to pay back a balance transfer, you will find that many sites promote the Wells Fargo Reflect Card,” Kiplinger said. “Kiplinger, however, no longer includes this card in our roundup of the best balance transfer cards because the card recently raised the transfer fee from 3% to 5%. So, if you transferred $10,000 from a high-APR credit card to the Wells Fargo Reflect card, you would now pay a $500 balance transfer fee instead of $300.”
Another Factor at Work
Another factor is also likely at work, as CUToday.info has also regularly reported, and that is rising delinquencies that have cut into the profitability of most portfolios.
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