Goodbye Egg Credit Card You're Not Competitive Anymore
August 2005
Timing, so they say is everything in life. So let's get the facts straight in relation to timing on the recent happenings with the once excellent Egg Credit Card.
- The Bank of England cuts interest rates by 0.25% and then a week later Egg decides to raise its Credit Card APR by 1% to a very uncompetitive 15.9%!
- Withdraw cash and the interest rate has gone up by 3% to 20.9%!
- The card now offers NO cashback scheme!
- The introductory 0% transfer deal has been cut from 8 to 6 months AND it now charges a fee for this service!
The card has gone from competitive to uncompetitive within 1 day because this credit card used to charge an APR of 9.9% alongside a generous cashback offer of 1% on all purchases.
Apathy Is The Likely Reason
Firstly, let's define apathy - Lack of interest and indifference. And this is what the banks and other financial institutions rely on to generate significant profits. The MO is always the same;
- Offer a great deal
- Generate significant media coverage
- Signup new applicants by the 1000's
- Wait several months
- Make the product uncompetitive for customers
- Watch profits surge
Now the banks know that a certain percentage of customers will leave but the majority won't because they might not realise what's happened, might not understand it or more likely can't be bothered to do anything about it.
So Which Credit Card To Get?
There's little point in complaining too much about the Egg card, business is business after all and we're free to choose which credit cards to use. Also it's hard to suggest the best credit card because they can all help in different ways. So let's group the best cards available into two sections, Best CashBack Credit Card and Best 0% Balance Transfer.
Summary
If you want the best deals in the Personal Finance world you've got to a) shop around and b) be prepared to shop around again when/if the product goes uncompetitive.
Case in point is the Egg credit card, it was good, many savvy customers sought it out but now as the financial goal posts have been changed those same savvy punters should look elsewhere. Go for the Amex cards if you can pay the monthly balance off every month and the Virgin card to take advantage of the excellent 0% transfer offer.
See Also
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