What Is The Future for Credit Card Reward Schemes?

5 Tips for Using Your Credit Card ResponsiblyThe future of reward schemes on credit cards is looking pretty uncertain. After the EU capped interchange fees at the end of 2014, interest rates have soared and many of the current rewards schemes, such as cashback when you use your card, that are offered by banks and building societies may soon begin to disappear.

In June, Capital One became the first major credit card firm to vastly reduce the rewards it offers to its customers, even cancelling their reward scheme entirely for some card holders. The company have stated that their rewards scheme was simply not sustainable any longer. This move will force other companies who offer similar rewards, like American Express, reconsider their own schemes and attempt to find other, more viable options for their loyal customers. Of course, these developments have left credit card holders wondering whether they are with the best company for them and if the future of their card’s reward scheme is stable.

So what can you do if your credit card firm decides to stop your rewards? Well first of all, do not feel obliged to stay with them. Take the opportunity to shop around and find a better deal for you. You may find it difficult to find the exact deal you were once on, but you should be able to find a rewards scheme that saves you money.

Another thing to consider is your spending habits. What do you spend your money on? Perhaps you would be better switching to a supermarket credit card that offers you points on many of your purchases. These cards are excellent for saving you money on your shopping and are potentially best for families. Maybe, if you’re a frequent flyer, find a rewards card that focuses on offering you air miles.

Companies seem to be trying different methods in order to keep offering rewards to their customers. For example, Nationwide have just relaunched their Simply Rewards scheme which offers great cashback incentives – if you spend your money in the right places. Although this is great if you shop in the stores that have opted to be part of this scheme, be careful. Each deal has its own terms and conditions, and you may have to choose to opt in to some deals, so read the fine print carefully.

Ultimately, it seems the rewards schemes will definitely remain. However they may look quite different to what we are currently used to. To get the best deal for you, keep a check of what your current card offers you and don’t be afraid to switch for something better.

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