| Baddest and Best Credit Cards |
| By Credit Federal |
Published
10/14/2007
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Credit Card
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Baddest and Best Credit Card Ratings
J.D. Power and Associates' survey of nearly 8,000 consumers reveals their ratings of the baddest and best credit cards. Included in the survey results were the 10 biggest credit card companies, including American Express, Discover, Bank of America, Citi, HSBC and Capital One.
American Express and Discover received the best ratings for cardholder perks, rewards for use, good rates, no-nonsense billing and few overall problems. Scoring the worst rankings were HSBC, Bank of America and Capital One.
One of the big factors is whether or not a credit card company posts payments on time, and it appears that those who process their own payments have less billing complaints. A card issuer that doesn't post payments on time or doesn't resolve billing problems quickly can cause major hassles and may ruin a cardholder's credit. Overall customer satisfaction was highest with American Express and Discover who own their own processing network. With all other card issuers such as Citi, Chase and Bank of America, the companies must rely on the MasterCard or Visa processing networks.
American Express scored five stars in all four major categories. Discover was given a five star rating in all but benefits/features, where it earned four stars. Perhaps perks offered by American Express contributed to its success, such as its guarantees to customers if they buy something and it's lost, stolen or needs to be returned. If a purchased item is lost or stolen within 90 days of purchase, American Express reimburses the customer. Additionally, if a customer wants to return an item a store won't take back, American Express will credit the person's account. American Express also offers preferred access to entertainment events such as concerts, with tickets and backstage access that are often otherwise difficult to gnab, plus global travel services such as translators and medical transportation. American Express target cardholders are affluent, high spending customers, and started offering accounts that consumers didn't have to pay off each month only in the 1990s.
Discover Card is known for its cash-back rewards of up to 1% on all purchases, and up to 5% on rotating categories. It's also the only major card that never charges an annual fee.
About one in 10 customers of Bank of America, Citi, HSBC and Capital One reported having a problem with the company in the past year. Ranking worst overall in the study was HSBC, the nation's 5th largest issuer with 30 million accounts. Among its cards is the popular General Motors rewards card. The J.D. Power study also found consumers were less satisfied overall with their credit card than other financial services such as their primary bank, investment broker or mortgage servicer.
And, companies that market themselves to lower income, bad credit consumers tend to rank lower on the satisfaction scale. Such credit cards tend to have higher interest rates, fewer rewards; if any, and many more problems with billing errors, payments not being posted timely slow operating Web sites.
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