Chase to Give More Even With Consumers Spending Less

In a recent article by the Wall Street Journal, I read that Chase has decided to give more rewards to consumers even as spending on credit cards as decreased drastically. In an attempt to draw and keep cardholders they have decided to give “Ultimate Rewards” that may rival those of American Express and Citi Bank. With the new reward program, consumers will get points on every dollar spent with no limit on the amount of points you can get and no expiration date. The points may then be redeemed for cash, rewards, gift cards, statement credit, and more. Currently this reward program will only be available on two credit cards, the Chase Freedom and the newly created Chase Sapphire Preferred Card, but should be made available to even more offers. Each of these cards will have an annual fee associated with them, but in my opinion you will see more and more credit cards regardless of type (rewards, low interest, student, etc.) have annual fees.

In my mind the question is, “Is this too little, too late?” As many cardholders see their interest rates rise and credit limits decrease, I would think that whether a card had rewards or not would be lower on the list of what cardholders must have. Not only that, some reward cards require cardholders to carry a balance when now more then ever cardholders are trying to pay in full each month.  Don’t get me wrong, if all things are equal than reward credit cards with a moderately low interest rate and no annual fee would be my choice.

As far a Chase goes, this is something that could keep current cardholders, or get the attention of potential cardholders as consumers are trimming the credit card inventory that they carry.

What is the greatest factor in determining what credit cards you apply for or keep?