The onset of recession saw the credit card usage plummeting below desirable levels. A large number of people either reduced their credit card usage to a great extent or completely discarded them so they can stay afloat on the little money they could manage to earn. Now with the recession becoming a thing of the past, credit card lenders are leaving no stone unturned to get the customers they lost during the last few years. The President for Consumer Education at one of the leading credit card sites, John Ulzheimer, says that the best way for companies to regain their market share is by offering lucrative rewards on their credit cards.
Customers are being flooded with solicitation mails with every passing day by almost all leading credit card lenders, thereby making it tough for them to make their choice. However, choosing just based on the rewards without reading through the fine print can actually be very disastrous. Most of the cards that offer rewards have various hidden factors that make up for the cost of the rewards.
The interest rates on rewards credit cards are much higher than the ones that do not offer rewards. The chief executive of a leading financial website, Bill Hardekoph, says that if you are not among those individuals who repay their balances in full each month, the money you are saving by redeeming the rewards is actually flowing towards the high interest rate on the card. The only way in which credit cards can work in favor of the customers is when they repay their outstanding dues on time each month in full.
