Consumer Satisfaction Plummets as Creditors Raise Interest Rates, Cut Credit Limits
As if 2009 didn’t bring enough bad news: recent polls released by J.D. Power and Associates reveal that consumer satisfaction with credit cards fell sharply in 2009.
It’s no surprise, really, that consumers are frustrated with their credit cards, as many have been socked with outrageous fees and equally outrageous interest rates as creditors scramble to recoup some of their losses.
Highlights of the J.D. Power and Associates Poll (which was conducted in May and June by 9,000 credit card customers):
- Twenty percent of credit card holders saw an increase in their interest rates between 2008 and 2009.
- Eighteen percent of credit card holders were dissatisfied with fees on their credit cards, which was a 10 percent jump from just a year earlier.
- The customer satisfaction index fell to 703 (on a 1,000-point scale), which is the lowest since J.D. Power and McGraw-Hill began the customer index satisfaction survey in 2007.
- Credit card customer satisfaction comes in dead last among all financial services industries, including banking, insurance and investment services.
- One out of five customers experienced a rise in their interest rate over the past year.
It is clear from this recent survey that most consumers are simply fed up with the over-the-top rates and fees being charged by many credit card companies as of late. As the government put the squeeze on credit card companies, and as the recession took its hold, credit card companies started responding by slashing rewards for customers and raising rates.
And this doesn’t sit very well with customers, as to be expected.
American Express, which is the largest credit card company based on sales, was ranked first in the poll for customer satisfaction, followed by Discover Financial Services and JPMorgan Chase. Those ranked below the industry’s average included Citigroup, Bank of America and Capital One.
It is important to note that American Express, Bank of America, JPMorgan, Citigroup, Capital One and Discover make up about 80 percent of the industry in the United States.
The J.D. Power and Associates poll reviewed customer satisfaction based on many factors, including rewards, benefits, services, problem resolution, interaction, fees, rates, billing and payment processing.
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