Credit Card Issuers Must Compete to Be the Only Card that Consumers Carry, J.D. Power Finds

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Bendigo Bank Ranks Highest in Credit Card Satisfaction in Australia

SYDNEY: July 30, 2019 — More credit cardholders in Australia are carrying only a single card, which presents a risk to loyalty and attrition, according to the J.D. Power 2019 Australia Credit Card Satisfaction Study,SM released today.  

The number of cardholders who only own one credit card has increased to 61% in 2019, up from 56% in 2018. When so many cardholders hold only one credit card, competition has shifted from being the primary card of use, to the only card that cardholders carry. Therefore, to gain loyalty and minimise attrition, issuers not only need to offer enticing rewards and benefits, but also present a holistic and seamless cardholder experience across all their interactions with their card issuer.

The cardholders’ view of benefits and services will become even more crucial, in view of regulatory reforms that constrain card issuers’ abilities to fund richer rewards programs. The study finds that benefits and services—perks provided by the issuer, regardless of spend—are vital to the acquisition of new cardholders, with 21% of cardholders citing them as a reason for choosing their primary card.

“In the age of hyper-personalisation, it is more critical than ever that issuers tailor their benefits and service offerings based on cardholders’ evolving needs,” said Bronwyn Gill, Head of Global Business Intelligence at J.D. Power. “An overwhelming number of cardholders use fewer than three types of benefits and services, so issuers should focus on quality instead of quantity. They must innovate and adapt best practices relating to personalisation of their products and services.”

A parallel concern amidst shrinking demand for more credit cards, is the rise of alternative installment services. More than one in five cardholders (22%) have utilised “buy now, pay later” services, with younger cardholders adopting these services almost three times faster than other cardholders. While traditional issuers still lead the market, their dominance cannot be taken for granted in the long-term.

Following are some key findings of the 2019 study:

  • Unsolicited credit limit increases still common: Post the July 2018 introduction of legislation prohibiting unsolicited credit limit increases, it is surprising to find that 57% of cardholders who were offered credit limit increases said that such offers were unsolicited.
  • Simplifying terms to cardholders: Less than half (48%) of cardholders have read the terms and conditions of their primary card. Amongst those who have not read the terms and conditions, reluctance to read is primarily due to the length of the text (53%). Amongst those who have read them, 84% say they do not fully understand them, with the top reason being the complexity of the language used (62%). The onus is on card issuers to make terms concise and reader-friendly.
  • Mobile app usage rates plateau: Less than half (44%) of cardholders used their credit card mobile app in the past 12 months, which represents only a 1% increase from 2018. The top reason cited by cardholders for not using credit card mobile apps in the past 12 months is the adequacy of other channels in meeting their needs (31%). This should be a concern for card issuers that place a strong emphasis on a digital experience and have invested in a mobile first approach.

Study Rankings

Bendigo Bank ranks highest in credit card satisfaction with an overall score of 763 (on a 1,000-point scale). American Express ranks second with a score of 757, while Commonwealth Bank ranks third with a score of 732. Overall satisfaction increased by 7 points to 717.

The 2019 Australia Credit Card Satisfaction Study measures overall satisfaction in six key factors: interaction (30%); credit card terms (30%); communications (16%); rewards (11%); benefits and services (9%); and key moments (5%)[1].

The study is based on responses from 4,609 credit cardholders. Now in its fifth year, the study includes 20 major credit card issuers in the market, 16 of which rank eligible, and scores are based on cardholders’ experiences with their primary card. The study was fielded in May-June 2019. In addition to Australia, J.D. Power also conducts credit card studies across key financial markets that include China, Hong Kong, Singapore, Canada and the United States.

The study includes the Net Promoter Score® (NPS)[2], which measures cardholders’ likelihood to recommend their card issuer on a 0-10 scale.

Media Relations Contacts

Shahilia Bhagat; J.D. Power; Singapore; 65-3165-0120; shahilia.bhagat@jdpa.com

Geno Effler; J.D. Power; Costa Mesa, Calif., USA; 001-714-621-6224; media.relations@jdpa.com

 J.D. Power is a global leader in consumer insights, advisory services and data and analytics. These capabilities enable J.D. Power to help its clients drive customer satisfaction, growth and profitability. Established in 1968, J.D. Power has offices serving North America, South America, Asia Pacific and Europe.

About J.D. Power and Advertising/Promotional Rules www.jdpower.com/business/about-us/press-release-info


[1] Due to rounding, percentages may not always appear to add up to 100%.

[2] Net Promoter,® Net Promoter System,® Net Promoter Score,® NPS,® and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Fred Reichheld and Satmetrix Systems, Inc. Net Promoter,® Net Promoter System,® Net Promoter Score,® NPS,® and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Fred Reichheld and Satmetrix Systems, Inc.

Media Contacts

Costa Mesa, California
(714) 621-6224

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