Half of consumers report that they select new cards based on reward programs, weighing “cash back” offers against “points” with their credit card provider that may convert into airline or hotel “miles,” which may have varying values depending on how they are redeemed.5 In some cases, rewards may apply to specific spending categories that rotate by quarter and require that consumers reregister each term, and the rewards may expire or be forfeited under complicated terms.6 In some cases, the choices may be confusing.
Let’s take the example of zero percent interest credit card promotions. A consumer may choose a zero percent interest credit card promotion and expect to pay no interest on balances during a promotional period, after which any balances are assessed at a higher rate of interest going forward.