Credit Card Companies Are Keeping Consumers Hooked with Irresistible Perks and Bonuses

Consumers are becoming more financially savvy, all thanks to the explosion of personal finance blogs that cater to different categories of people. One of the most profound wisdom nuggets in the personal finance industry is the need for people to reduce their dependency on credit cards in order to cut down credit card debts.

Hence, many people are canceling their extra credit cards, paying up (or consolidating) their credit card debts and credit card companies are finding it harder to get people to sign up. Nonetheless, Chase Bank is making waves in the credit industry with impressively warm welcome that its new Chase Sapphire Reserve card enjoyed.

People are throwing away a profound personal finance advice

About one month ago, rumors about Chase Bank’s plan to introduce a new credit card started making the rounds. Naturally, rumors or news about a new credit card should have been met with indifference among consumers but consumers were strangely expectant of the Chase Sapphire Reserve card. The allure of the new credit card lies in its high churning potential for consumers who obsess over credit-card reward programs.

To start with, the Sapphire Reserve card has some impressive perks that many card-churners can’t ignore. If you spend $4000 in the first three months, you are entitled to a sign-up bonus of 100,000 points, which is worth $1500 in travel. Cardholders are also entitled to three point on every $1 spent on dining and travel. The best part is that Chase defines travel as “movement over distance in time”; hence, you’ll qualify for the points if you use Uber or Airbnb. In addition, cardholders get a $300 annual credit reimbursement on travel expenses. Mixing credit card perks with Cash Back and Coupons can bring a smart customer massive earnings.

Interestingly, the fact that the Sapphire Reserve card attracts a massive $450 annual fee has not deterred people for signing up en masse for the card. According to Chase’s spokeswoman, Lauren Francis, the firm bank has approved “tens of thousands of application” which has “significantly exceeded our strongest expectations”.

Credit Card companies now offer perks too good to be true

Credit card companies know that there is a war on credit as consumers become more financially literate. However, credit card companies are developing new marketing strategies to keep consumers hooked and depended on credit cards.

In the case of Sapphire Reserve card, Chase is offering bonuses that make it seem like you are getting free money. However, a credit card expert on CreditLoan observes that “the card is not necessarily for everybody” because $450 annual fee could be potentially expensive for some cardholders.  More so, consumers need to understand that $1,500 in travel rewards isn’t the same as $1,500 in cash.

Nevertheless, the strategy of offering mouth-watering perks on credit card seems to be working wonders. Frank Leppar, a resident of Weirton, West Virginia who has applied for the card noted that “the sign-up bonus is amazing. It’s one of the better, if not the best, card out right now.”

More so, Reddit’s “credit-card churning forum” has seen an 11,000 increase in subscribers from 42,000 to 53,000 in three months. More so, a thread on forum about Chase Sapphire Reserve card now has about 10,000 comments.

Nonetheless, the fact that credit card companies are offering mouth-watering perks doesn’t mean that they’ll give out a card to every Tom, Dick, and Harry that applies. The bank doesn’t want to give out its card to obsessive churners and one of its approval policies states that “You will not be approved for this card if you have opened 5 or more bank cards in the last 24 months.”