The nation’s top credit card lenders are now in greater competition for borrowers with the best available credit ratings, and as such are now vastly expanding rewards programs and benefits for those consumers.
Americans who have top-notch credit ratings will likely soon find a greater number of offers for new credit cards coming their way, most of which are for extremely generous rewards programs, according to a report from the Baltimore Sun. In fact, two-thirds of credit card offers sent out during the month of September alone were for accounts that came with reward or rebate programs, and while that’s a smaller proportion than the one seen in June, the value of those rewards programs has been on the increase.
The issue, though, is that many consumers who want to benefit from using these more generous rewards offers may not have access to them, the report said. For now, these offers are being sent almost exclusively to those whose credit ratings are 750 or better. Those with ratings between 700 and 749 may be able to access these offers as well, but they will likely be hit with a higher interest rate on whatever credit card debt they rack up on the card.
One of the top benefits many of these accounts now carry is that they either do not have an annual fee at all, or, if they do, it’s waived by the lender for the first year the account is open, the report said. In addition, many lenders are now seriously beefing up the bonuses consumers receive just for signing up. For example, many are granting tens of thousands of rewards points upon sign-up, and then as much as doubling that total when the customer reaches a predetermined spending amount within the first few months the account is open.
However, rewards credit cards may not be for everyone, particularly if they come with an annual fee. It’s important for the consumer to take the time to determine whether the amount of benefits they’ll earn on the card in an average year – based on past credit card spending habits – will add up to be worth more than the annual fee and the additional cost of the higher interest rate.