Screw you Barclaycard

Hoenir

TobyCG said:

 To that end I enquired with Barclaycard about switching to a rewards card, likely the Avios one.

Why not simply apply for one?  Internally switching between cards probably isn't as simple as you think it is. 

MDMD

Hoenir said:

TobyCG said:

 To that end I enquired with Barclaycard about switching to a rewards card, likely the Avios one.

Why not simply apply for one?  Internally switching between cards probably isn't as simple as you think it is. 

You can only have one barclaycard at once and I think if you cancel an existing one you need to wait six months

TobyCG

Hoenir said:

TobyCG said:

 To that end I enquired with Barclaycard about switching to a rewards card, likely the Avios one.

Why not simply apply for one?  Internally switching between cards probably isn't as simple as you think it is. 

My concern was that the application would be rejected because I already have an existing card and that this might then show up as a "credit refused" on my report.

Phoenix72

TobyCG said:

Hoenir said:

TobyCG said:

 To that end I enquired with Barclaycard about switching to a rewards card, likely the Avios one.

Why not simply apply for one?  Internally switching between cards probably isn't as simple as you think it is. 

My concern was that the application would be rejected because I already have an existing card and that this might then show up as a "credit refused" on my report.

If there was such a thing then you would have cause to worry.......as there isn't, crack on

WillPS

zagfles said:

paul_c123 said:

zagfles said:

paul_c123 said:

The best way to screw a credit card company IS to spend heavily on it and pay the balance in full by the due date. So, at least you have the warm reassurance that you've already been doing it for years. 

Start being a bit sloppy with paying in full, a bit of interest or fees here and there, etc and the offers will come flooding at you.

How do you think that "screws" them? Credit card companies still make loads of money through the fees they charge retailers so they're quite happy with full payers, that's why they offer the specific interest free exemption for paying in full. Plus even cashback with some cards. IIRC something like 60% of people pay in full every month.  

1) Because it costs them to provide the infrastructure/service/etc of providing a credit card.
2) Because they're offering a credit line for free

Sure, they make money through retailers fees etc but its a competitive, marginal, industry. They won't make any money from full-payers. Its all relative.

Of course they make money from full payers. Over half CC users are full payers, why would they want such customers if they didn't make money from them? And even give them cashback on top with some cards. If they didn't want them or weren't making money from them they'd simply charge interest from the purchase date to the payment date with no exemption for full payers. 

They like full payers, because they're a reliable rock solid income stream. Obviously they'd prefer it if you pay them interest as well, but they know that anyone who manages their finance properly is never going to pay interest at credit card rates. So if they did charge everyone interest from the purchase date, then full payers would close their cards and use debit cards instead.

But they want full payers, hence the specific interest exemption for them. 

As with any business they'll have loss leaders, for instance 0% offers, but they're always temporary time-limited offers which require action by the customer to avoid big fees/interest at the end. Paying a card in full every month requires zero action after setting up a DD to pay in full, and can last decades. They're not going to have ongoing permanent loss leaders for half their customer base. 

The interchange rate for UK personal credit cards used in the UK is capped at 0.3%. That's the total amount which goes to Visa or Mastercard, and they will likely pay some of that (but not all of it, otherwise they'd make nothing!) to your issuer in commission. Think about the costs of providing an account to you - as one example, it costs a fiver for them to issue a card and have it sent to you; assuming Barclaycard get all the interchange revenue (and they wont!) it'd take £1667 of UK spend to cover its cost. Every bit of paper you receive in the post will have cost them at least a quid now too. This is before you try and figure out the cost of providing a working service and fulfilling their obligations (incl S275).

There is no way they are making a profit on £12-20k UK annual spends paid in full, even giving you zero in rewards.

They want you to pay interest, or pay fees for other stuff like FX. The reason they don't charge interest until the payment due date is because literally the entire market doesn't, so their cards would be completely uncompetitive if they did.

lr1277

A couple of things wrt to Amex.

Before 2021 when card companies started tightening the limits they gave customers, was that Amex used to give relatively high limits. The downside of this was that your total credit available would be very high and so make it more difficult to get another non-Amex card. I do not know if Amex still gives relatively high limits. But if they do, you can ask them to reduce it to a mangeable amount.

Secondly, if your circumstances change and you need to BT your balance away from Amex, not every credit card accepts a BT from Amex.

35har1old

WillPS said:

zagfles said:

paul_c123 said:

zagfles said:

paul_c123 said:

The best way to screw a credit card company IS to spend heavily on it and pay the balance in full by the due date. So, at least you have the warm reassurance that you've already been doing it for years. 

Start being a bit sloppy with paying in full, a bit of interest or fees here and there, etc and the offers will come flooding at you.

How do you think that "screws" them? Credit card companies still make loads of money through the fees they charge retailers so they're quite happy with full payers, that's why they offer the specific interest free exemption for paying in full. Plus even cashback with some cards. IIRC something like 60% of people pay in full every month.  

1) Because it costs them to provide the infrastructure/service/etc of providing a credit card.
2) Because they're offering a credit line for free

Sure, they make money through retailers fees etc but its a competitive, marginal, industry. They won't make any money from full-payers. Its all relative.

Of course they make money from full payers. Over half CC users are full payers, why would they want such customers if they didn't make money from them? And even give them cashback on top with some cards. If they didn't want them or weren't making money from them they'd simply charge interest from the purchase date to the payment date with no exemption for full payers. 

They like full payers, because they're a reliable rock solid income stream. Obviously they'd prefer it if you pay them interest as well, but they know that anyone who manages their finance properly is never going to pay interest at credit card rates. So if they did charge everyone interest from the purchase date, then full payers would close their cards and use debit cards instead.

But they want full payers, hence the specific interest exemption for them. 

As with any business they'll have loss leaders, for instance 0% offers, but they're always temporary time-limited offers which require action by the customer to avoid big fees/interest at the end. Paying a card in full every month requires zero action after setting up a DD to pay in full, and can last decades. They're not going to have ongoing permanent loss leaders for half their customer base. 

The interchange rate for UK personal credit cards used in the UK is capped at 0.3%. That's the total amount which goes to Visa or Mastercard, and they will likely pay some of that (but not all of it, otherwise they'd make nothing!) to your issuer in commission. Think about the costs of providing an account to you - as one example, it costs a fiver for them to issue a card and have it sent to you; assuming Barclaycard get all the interchange revenue (and they wont!) it'd take £1667 of UK spend to cover its cost. Every bit of paper you receive in the post will have cost them at least a quid now too. This is before you try and figure out the cost of providing a working service and fulfilling their obligations (incl S275).

There is no way they are making a profit on £12-20k UK annual spends paid in full, even giving you zero in rewards.

They want you to pay interest, or pay fees for other stuff like FX. The reason they don't charge interest until the payment due date is because literally the entire market doesn't, so their cards would be completely uncompetitive if they did.

So how are Santander offering 2% the first year with  cap of £15 - the fee £3 and if you applied recently you will receive a further £18 cashback 
Second year 1% capped again of £15- minus £3 not worth having after the first year.if Chase is still offering the1%
Also it sames to be a little pointless to have a large credit limit offered 
£1250 for 1st year would be sufficient allowing for a view errors when spending and say £2000 in the 2nd

zagfles

MDMD said:

Hoenir said:

TobyCG said:

 To that end I enquired with Barclaycard about switching to a rewards card, likely the Avios one.

Why not simply apply for one?  Internally switching between cards probably isn't as simple as you think it is. 

You can only have one barclaycard at once and I think if you cancel an existing one you need to wait six months

I've got 2, but they might have changed the rules since I got mine. 

Nebulous2

WillPS said:

zagfles said:

paul_c123 said:

zagfles said:

paul_c123 said:

The best way to screw a credit card company IS to spend heavily on it and pay the balance in full by the due date. So, at least you have the warm reassurance that you've already been doing it for years. 

Start being a bit sloppy with paying in full, a bit of interest or fees here and there, etc and the offers will come flooding at you.

How do you think that "screws" them? Credit card companies still make loads of money through the fees they charge retailers so they're quite happy with full payers, that's why they offer the specific interest free exemption for paying in full. Plus even cashback with some cards. IIRC something like 60% of people pay in full every month.  

1) Because it costs them to provide the infrastructure/service/etc of providing a credit card.
2) Because they're offering a credit line for free

Sure, they make money through retailers fees etc but its a competitive, marginal, industry. They won't make any money from full-payers. Its all relative.

Of course they make money from full payers. Over half CC users are full payers, why would they want such customers if they didn't make money from them? And even give them cashback on top with some cards. If they didn't want them or weren't making money from them they'd simply charge interest from the purchase date to the payment date with no exemption for full payers. 

They like full payers, because they're a reliable rock solid income stream. Obviously they'd prefer it if you pay them interest as well, but they know that anyone who manages their finance properly is never going to pay interest at credit card rates. So if they did charge everyone interest from the purchase date, then full payers would close their cards and use debit cards instead.

But they want full payers, hence the specific interest exemption for them. 

As with any business they'll have loss leaders, for instance 0% offers, but they're always temporary time-limited offers which require action by the customer to avoid big fees/interest at the end. Paying a card in full every month requires zero action after setting up a DD to pay in full, and can last decades. They're not going to have ongoing permanent loss leaders for half their customer base. 

The interchange rate for UK personal credit cards used in the UK is capped at 0.3%. That's the total amount which goes to Visa or Mastercard, and they will likely pay some of that (but not all of it, otherwise they'd make nothing!) to your issuer in commission. Think about the costs of providing an account to you - as one example, it costs a fiver for them to issue a card and have it sent to you; assuming Barclaycard get all the interchange revenue (and they wont!) it'd take £1667 of UK spend to cover its cost. Every bit of paper you receive in the post will have cost them at least a quid now too. This is before you try and figure out the cost of providing a working service and fulfilling their obligations (incl S275).

There is no way they are making a profit on £12-20k UK annual spends paid in full, even giving you zero in rewards.

They want you to pay interest, or pay fees for other stuff like FX. The reason they don't charge interest until the payment due date is because literally the entire market doesn't, so their cards would be completely uncompetitive if they did.

There has to be more  to it than that -  isn't the interchange fee only part of the total fee? 

I've no reason to complain about Barclaycard. My card still gives me 0.5% cashback. It has my second highest limit, after MBNA and despite all the aggressive limit reductions they did in recent years, they left me alone. 

During a dispute over a holiday disrupted by covid, which involved a holiday company and my insurer, Barclaycard got drawn into the mix as my insurer insisted I tried to reclaim from my payment method. They were better to deal with than any of the other two and paid back everything I had paid on my credit card. 

I've just tried the change card offer and was offered a 0.25% reward or two different avios cards. 

zagfles

WillPS said:

zagfles said:

paul_c123 said:

zagfles said:

paul_c123 said:

The best way to screw a credit card company IS to spend heavily on it and pay the balance in full by the due date. So, at least you have the warm reassurance that you've already been doing it for years. 

Start being a bit sloppy with paying in full, a bit of interest or fees here and there, etc and the offers will come flooding at you.

How do you think that "screws" them? Credit card companies still make loads of money through the fees they charge retailers so they're quite happy with full payers, that's why they offer the specific interest free exemption for paying in full. Plus even cashback with some cards. IIRC something like 60% of people pay in full every month.  

1) Because it costs them to provide the infrastructure/service/etc of providing a credit card.
2) Because they're offering a credit line for free

Sure, they make money through retailers fees etc but its a competitive, marginal, industry. They won't make any money from full-payers. Its all relative.

Of course they make money from full payers. Over half CC users are full payers, why would they want such customers if they didn't make money from them? And even give them cashback on top with some cards. If they didn't want them or weren't making money from them they'd simply charge interest from the purchase date to the payment date with no exemption for full payers. 

They like full payers, because they're a reliable rock solid income stream. Obviously they'd prefer it if you pay them interest as well, but they know that anyone who manages their finance properly is never going to pay interest at credit card rates. So if they did charge everyone interest from the purchase date, then full payers would close their cards and use debit cards instead.

But they want full payers, hence the specific interest exemption for them. 

As with any business they'll have loss leaders, for instance 0% offers, but they're always temporary time-limited offers which require action by the customer to avoid big fees/interest at the end. Paying a card in full every month requires zero action after setting up a DD to pay in full, and can last decades. They're not going to have ongoing permanent loss leaders for half their customer base. 

The interchange rate for UK personal credit cards used in the UK is capped at 0.3%. That's the total amount which goes to Visa or Mastercard, and they will likely pay some of that (but not all of it, otherwise they'd make nothing!) to your issuer in commission. Think about the costs of providing an account to you - as one example, it costs a fiver for them to issue a card and have it sent to you; assuming Barclaycard get all the interchange revenue (and they wont!) it'd take £1667 of UK spend to cover its cost. Every bit of paper you receive in the post will have cost them at least a quid now too. This is before you try and figure out the cost of providing a working service and fulfilling their obligations (incl S275).

The interchange fee is only a small part of the fee paid by merchants. See UK Card Processing Fees | Don't Get Ripped Off (merchantsavvy.co.uk) 

They want you to pay interest, or pay fees for other stuff like FX. The reason they don't charge interest until the payment due date is because literally the entire market doesn't, so their cards would be completely uncompetitive if they did.

Why would they want to compete for customers who they don't profit from?

The BC rewards card gives 0.25% cashback and has zero forex markup. The cost of providing full payers with average 40 days interest free is over 0.5% at the base rate. They know that about half their customers will pay in full every month. That's a loss of 0.45% on every transaction if you really think they only get a 0.3% fee! Plus admin, S75 costs etc. That's obviously not sustainable as a long term loss leader for half their customer base. 

Credit card companies have 2 types of customers, those who use them to borrow and those who use them for day to day spending, S75 protection etc, and who pay them off every single month on time. They are interested in both types.