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Research: Credit card reward systems and the way they word - Credit-Land.com

There are various systems of rewards that are offered by banks for credit cards. A lot of banks have started offering these sorts of rewards with a view to increase their customer base. And with the current economic crisis that the planet is facing, it is becoming more important for banks to devise new ways to attract customers.

There are a number of credit card rewards systems. The most popular type of credit card reward is the points based system. Under the point`s bases system, the card holder would get points for every time that the card is used. The number of points obtained could depend on the number of swipes or the dollar amount that is spent on the purchase. Always try to find out what sort of system your card follows before you go chasing points for yourself.

Apart from this type of reward system there are several others which follow a more direct way of rewarding the customer. Many times, banks give out freebies to customers when they first open their accounts. This sort of reward could be a vacation package or even a mobile phone. But before accepting such rewards, make sure you really need them in the first place. There could be a lot of rewards that you just won`t need.

But apart from rewards, there are a lot more things that you need to look into while choosing your credit card. Rewards are just a way of enticing the customer into going for a particular credit account. Apart from rewards, you will have to find out whether the credit account is actually worth taking for its features. The interest rate that you will be paying on borrowed amounts needs to be as low as possible. Along with this, try getting a higher credit limit on the credit account if you are going to be using it to make large purchases. Ensure that your card does not have an annual fee. If so, try to get it revoked or get a better deal on the other features. Not many cards have an annual fee these days and it really does not make sense for you to pay to be able to use a credit account.

Rewards are a means to attract more customers. You need not spend in order to get rewards, but rewards are just a bonus that one gets for using a credit card. It must not become the sole reason why you spend on your card. Remember, you still need to pay back whatever you spend on your card.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.