Credit card rewards and cardholder satisfaction statistics

There's great news for credit card issuers: Consumers are happier with their credit cards than they've ever been.

Overall customer satisfaction among credit card holders in 2015 ranked 790 on J.D. Power's 1,000-point scale, breaking the previous record of 778 in 2014. 1

So what do consumers like most about their credit cards? Fifty-two percent said in 2015 that they chose a new card for a better rewards program. Twenty-four percent said they chose a new card for better benefits. 1

The quest for the best rewards

Among consumers whose preferred payment instrument is a credit card, 86 percent said in 2015 their card had a rewards program associated with it. 2

When asked what features were most attractive in their credit card, 55 percent of respondents in 2015 said rewards type, 33 percent said card brand, 32 percent said payment options/flexibility and 30 percent said interest rate. 2

Cash back is the most popular type of reward. Fifty-five percent of cardholders said in 2015 that they most often redeemed rewards points for cash. That was followed by 26 percent who redeemed points for gift cards, 9 percent who redeemed points for travel, 8 percent who redeemed points for merchandise and 2 percent who redeemed points for dining. 2

Of cardholders who have cards with rewards, 54 percent in 2015 said their rewards were attractive, up from 46 percent in 2014. 1

Banks have strong incentive to keep customers happy with their rewards. People who like their cards' reward programs tend to spend more on them. In 2015, consumers who rated their rewards as attractive spent $1,132 per month on average compared to $744 per month spent by those who considered their rewards unattractive. 1

Happiness with rewards programs seems to stem from rewards redemption. Rewards satisfaction was highest among consumers who redeemed their rewards most frequently. Fifty-three percent of rewards cardholders in 2015 had redeemed rewards in the previous six months, compared to 49 percent the year before. 1 Those who had redeemed rewards in the previous six months had a satisfaction rate of 856 on J.D. Power's 1,000-point scale. On the other hand, those who had redeemed rewards six to 12 months prior had a satisfaction rate of 828, and those who'd never redeemed their rewards had a satisfaction rate of 728. 1

Customers in 2015 who redeemed rewards spent approximately $1,128 per month while those who didn't redeem rewards spent approximately $645 per month. 1

Rewards also encourage customer loyalty. American consumers held 3.3 billion memberships in customer loyalty programs in 2015, with credit card reward programs accounting for the most memberships at 578 million. However, credit card rewards programs are growing at a slower pace than in years past. In 2015, memberships in those programs grew 5 percent, compared with 28 percent in 2013. 3

Benefits are big business

Rewards aren't all that credit cards have to offer. Many offer other benefits such as emergency assistance and car rental insurance. Cardholders are more likely to use their card benefits than in years past. In 2015, 67 percent of cardholders said they used at least one credit card benefit in the past year, up from 57 percent in 2014. 1 Cardholders who have used card benefits have generally been more satisfied with their card issuer than those who have not, and those who use their benefits spend more. In 2015, cardholders who used their card benefits spent on average $316 more than those who did not use cardholder benefits. 1

Sixty-six percent of cardholders who were highly satisfied with their credit cards in 2015 said they definitely would recommend their card issuer and 56 percent of that same group said they definitely would not switch to another card issuer. 1 On the other hand, only 3 percent of displeased customers said in 2015 that they would definitely recommend their card issuer and 13 percent said they would not switch providers. 1

The highest customer satisfaction rating, according to J.D. Power, belongs to Discover, which topped the list for the second year in a row.

1. Discover
2. American Express
3. Chase
4. Capital One
5. Barclaycard
6. Wells Fargo
7. Bank of America
8. U.S. Bank
9. Citi
10. GE Capital Retail Bank/Synchrony Bank 1

Room for improvement, especially with security

When asked what features would make a payment card more valuable, 54 percent of respondents in 2015 said cash-back discounts at specific merchants that would be credited to their accounts immediately. That was followed by 45 percent who said discounts with specific merchants and 45 percent who said cards upgraded to support EMV. 2

One concern that cardholders have is security. Customers who believed in 2015 that their personal information was very secure were more satisfied with their card issuers than those who did not believe their personal information was secure. Only 32 percent of cardholders in 2015 believed their personal information was secure. 1

When it comes to age, 45 percent of Generation Z and 37 percent of Generation Y cardholders believed in 2015 that their personal information was very secure compared with 31 percent of Generation X cardholders, 29 percent of Baby Boomers and 32 percent of Pre-Boomers. 1

Race and ethnicity make a difference in beliefs about security, too.

Privacy and issuer communications

However, many consumers are less concerned about privacy. In 2015, 60 percent of survey respondents said they were willing to receive coupons and special offers based on information their card issuer collected about their buying behavior. 2

FACTOID:

Fifty-five percent of consumers say they have not asked their banks to stop sending paper statements. 2

Consumers also have strong opinions about how they would like their card issuers to communicate with them. Forty-three percent of consumers said in 2015 that they would be open to receiving marketing and special offer communications by their bank once a month. However, most wanted that correspondence to be nonintrusive, with email being the preferred method of communication. 2

Sources

1. J.D. Power 2015 U.S. Credit Card Satisfaction Study
2. TSYS 2015 U.S. Consumer Payment Choice Study
3. 2015 COLLOQUY Loyalty Census

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See related:Credit card statistics, industry facts, debt statistics , Debit card statistics , Credit card market share statistics

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.