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Interesting Tidbits From J.D.Power's Credit Card Study

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J.D. Power and Associates recently released their 2010 U.S. Credit Card Satisfaction Study, an annual tradition of theirs that is meant to give us an inside look at how consumers perceive the different credit card companies. This year was an interesting one, because their last report would've been released before the CARD Act began to take effect, so this is our first look at how consumers' relationships with their credit card issuers have changed in the aftermath of financial reform. As a credit card nerd, I enjoy reading through these types of reports to pick out the random facts that I find most interesting.

As was widely reported, American Express won top honors for the fourth consecutive year, followed closely by Discover. Maybe it's time for all of us to make the switch from Visa and MasterCard?

HSBC and Citibank took up the caboose with abysmal scores across the board, including the worst possible marks in credit card terms, benefits, and customer interaction. If you've ever fallen down the proverbial rabbit hole trying to get a Citibank customer service rep on the line, you are probably mournfully nodding your head right now.

Overall customer satisfaction increased a trivial amount, but customer loyalty took a dip as those who said they would "definitely not switch" in the next 12 months dropped from 25% to 22%. It's good to see that credit card customers are becoming more and more rational, and realizing that loyalty in the banking business rarely pays. Loyal customers are just easy revenue for banks, while the numbers-driven customers keep banks on their toes and force them to pony up better credit card offers in order to earn repeat business. In the words of Cuba Gooding Jr., "Show me the money!"

Credit card customers are more likely to view banks as "financially stable", which I'm guessing was a holdover question from the midst of the financial crisis. However customers are also less likely to view the banks as "customer driven." They've clearly gotten to see the worst out of many of these card issuers over the past few years, as the financial regulation debate has spotlighted many of their most underhanded practices, like inactivity fees.

Only one-third of customers surveyed say they "completely understand" their credit card terms. No surprise there, have you ever tried reading one of these things?

Did you know that J.D. Power has a Web Intelligence Division? They do, and they're apparently monitoring our online conversations to deduce that credit card customers view their relationships as a game of "cat and mouse." This is why I say you have to learn the rules of the game, so you can outsmart them.

"Revolvers," who carry balances, showed the largest increase in satisfaction with credit card terms, probably because the recent regulations were geared specifically towards limiting the fees and interest rates that these customers have to pay. Meanwhile the satisfaction of "transactors," who pay their balances off each month, declined slightly, likely because they're now footing more of the bill in terms of stingier rewards programs and higher annual fees.

What I'd really like to see at this point is a similar survey regarding small business credit cards. These cards weren't subject to the CARD Act regulations, so their terms probably aren't changing as quickly as with personal credit cards. However, their users are probably a lot more savvy (and therefore a lot more unhappy) than they were a year or so ago.

To the commenters out there -- where do you stand in these stats? And if you have a business credit card, how has your relationship with credit cards changed?