Printer Friendly

CONSUMERS ARE SHOPPING FOR NEW CREDIT CARDS NEARLY ONE-THIRD OF CONSUMERS ARE CHANGING THE CARDS THEY USE

 NEW YORK, April 1 /PRNewswire/ -- Bank credit card holders are dropping their high-rate cards and using ones that offer lower interest rates. During the past year, 31 percent of all cardholders made some significant change in the cards they use, 22 percent of all cardholders canceled at least one card and 12 percent started using a new card.
 According to a new survey conducted by Princeton Survey Research Associates (PSRA) for American Express Travel Related Services Company, Inc., nearly 50 percent of respondents who knew the interest rates they paid on their credit cards say they mainly use a card with an interest rate under 16 percent -- compared to only 25 percent a year ago. The number of people using credit cards with a rate of 18 percent interest or higher dropped 17 percent, from 59 percent last year to only 42 percent this year.
 Last year, 36 percent of routine revolvers rejected the idea of paying their balances in full. Now only 16 percent, or half as many, say they would not consider trying to pay their bills in full. In addition, people who carried an unpaid credit card balance from month to month were more likely than those who paid off their balance in full to have canceled a card.
 "This past year, a significant number of American credit card holders started shopping around to lower their credit card costs," said Diane Colasanto, president of PSRA. "What they need to do next is change the way they use their cards."
 While people have begun to shop for credit cards with lower interest rates, the survey found that there has been no improvement during the past year in credit card holders' knowledge about the fees and charges on their cards. Forty-four percent of credit card holders said they have only a fair to poor understanding of their credit card fees and charges, versus 13 percent who thought they had an excellent understanding of the charges related to their credit cards.
 -- 57 percent of cardholders do not know that the bank that issues their credit card also sets the interest rate on the card.
 -- More than a third (36 percent) do not know the name of the blank or other financial institution that issues their card.
 -- 36 percent of cardholders do not know their card's annual percentage rate or whether their card has other fees, like charges for late payments.
 -- While the majority of cardholders know their card has a grace period, 78 percent do not know the grace period only applies if there is no unpaid balance.
 Americans continue to have trouble focusing on their level of debt and are more likely to worry about their savings accounts, investments and inability to afford luxuries -- while ignoring the amount of debt they carry. To that point, 60 percent of credit card revolvers have no idea how much interest they paid last year on their credit card bills. About the same amount (55 percent) cannot even estimate what they were charged in interest on their most recent bill.
 The survey, which focused on credit card practices, attitudes and knowledge, was conducted in March 1993 among a nationally representative sample of 2,000 adults 18 years or older. A similar survey in March 1992 involved a nationally representative sample of 1,000 adults 18 years or older. The margin of sampling error is plus or minus three percentage points.
 American Express Travel Related Services Company, Inc. is a wholly owned subsidiary of the American Express Company -- a family of travel, financial and communications businesses.
 -0- 4/1/93
 /CONTACT: Gail Wasserman, 212-640-2675, or Gregory Tarmin, 212-640-4428, both of American Express Travel Related Services Company, Inc./
 (AXP)


CO: American Express Travel Related Services Company, Inc. ST: New York IN: FIN SU:

SM-OS -- NY004 -- 1868 04/01/93 09:01 EST
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Apr 1, 1993
Words:637
Previous Article:NEW TECHNOLOGY CAN REDUCE THE NATIONAL DEFICIT
Next Article:CONSUMERS TAKE ACTION WHEN ARMED WITH INFORMATION; INFORMATION ABOUT LOWERING CREDIT CARD COSTS DEFEATS INERTIA
Topics:


Related Articles
WACHOVIA CREDIT CARD INTEREST RATE FALLS TO ONE-HALF U.S. AVERAGE
CONSUMERS TAKE ACTION WHEN ARMED WITH INFORMATION; INFORMATION ABOUT LOWERING CREDIT CARD COSTS DEFEATS INERTIA
IT'S VACATION TIME...BUT HOW ARE YOU GOING TO PAY! RECENT SURVEY BY GOLD MASTERCARD SHOWS 65 PERCENT OF TRAVELERS WILL CHARGE THEIR EXPENSES
AMERICAN EXPRESS AND MCI FORM NEW CONSUMER MARKETING INITIATIVE
SAN FRANCISCO SUPERMARKET SHOPPERS LIKE THE OPTION OF CHARGING THEIR GROCERY PURCHASES ACCORDING TO AN AMERICAN EXPRESS SURVEY
LOS ANGELES SUPERMARKET SHOPPERS LIKE THE OPTION OF CHARGING THEIR GROCERY PURCHASES ACCORDING TO AN AMERICAN EXPRESS SURVEY
40% OF U.S. CONSUMERS PLAN HOME IMPROVEMENTS THIS YEAR ACCORDING TO AMERICAN EXPRESS RETAIL INDEX
New Free Marketplace Lets Consumers Shop for Credit Cards the Way They Shop for Groceries: Hundreds of Brands, Products and Prices Now Under One Roof
Credit unions ponder the fate of their fixed-rate credit cards.
"Lifestyle spending down but not out".

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters