Are You Throwing Away Your UK Credit Card Loyalty Points?
9 out of ever 10 UK credit card users today elects to use a credit card that has been offered by a UK credit card issuer that is backed by a loyalty use program. Given that this is best practice advocated by many, this should not be too surprising and shows that British credit card users are becoming more educated about which credit card issuer provides the best service for their overall requirements.
Probably a little more surprising for UK credit card issuers to learn, but as equally as nice to hear, is that 80% of all UK credit cardholders who use a credit card that has a loyalty program consider themselves “strongly committed” to the loyalty scheme, to the extent that they will use the card as much as possible in order to tally up their loyalty program points. Again, provided you are not overspending on the card to the extent that you get in financial difficult, this should be best practice for all credit card users.
So, why then, is it that UK credit cardholders throw away over £ 125 million a year simply by failing to redeem our loyalty program points?
Knowing how to redeem your points
When it comes to asking UK credit cardholders how they accrue loyalty program points on their credit card, over 90% are aware of how they can get UK credit card loyalty programs on their scheme. But, this figure is almost reversed when it comes to redeeming UK credit card loyalty points, with one in eight UK credit cardholders admitting that they will fail to redeem at least some of their loyalty program point during the course of this year. Knowing how to redeem your points is as important as knowing how to accrue them!
- Cash Back or Rewards
In the battle for new customers, credit card companies are offering to reward users for simply spending on their cards. The two most attractive systems seem to be cash back and rewards.
Losing your points
One in five UK credit cardholders will lose their accrued loyalty program points this year. Now, you may well be wondering how, exactly, you lose your loyalty program points. If so, the following are the most common ways:
- by transferring the balance of your credit card to a new issuer without having first redeemed your loyalty points
- by having “eyes bigger than your belly” syndrome. Here, many UK credit cardholders admit they try to hoard their loyalty program points until they have enough points to get a big reward, rather than using the points to get smaller rewards. Doing this means they often miss a deadline in which to redeem some of their expiring loyalty points and thus lose them.
- by failing to comply with the terms of the agreement with the credit card provider (for example, having their credit card revoked) and thereby forfeiting the loyalty program points
Make sure you redeem your points
The simple fact is that as UK credit cardholders we do now seem to be fairly well informed when it comes to seeking out a credit card issuer that is offering a loyalty program that we like. However, equally true is that no credit card loyalty program in the world is worth anything if we continue to fail to redeem our loyalty program points. It is, therefore, essentially that we now not only educate ourselves as to which loyalty program is best for us, but also how we can make the UK credit card loyalty program work best for us.
Richard Smith
1st September 2006
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