credit card query

  [DELETED] 15:30 29 Apr 2006

Hello everyone. My cash-back credit card provider is withdrawing the service, and wishes me to accept the banks Platinum credit card in its place- with no cash-back deal. I ask my bank why a Platinum card, why not the basic credit card? and I got no sensible answer.

Can any knowledgeable forum member say why?
Can any member say why the banks introduced the Gold and the Platinum credit card at all, if they are indeed just credit cards as I was told?

  [DELETED] 16:27 29 Apr 2006

Different levels of credit and risk with each.

Poorer CC holders get the raw deal with basic cards and higer interest charges as they pose the most risk for not repaying the debt.

Platinum cards are for higher earners and will have larger limits and lower interest.

They increase limits and the like if you prove to be a good customer, ie repay in full and pay no interest. The provider won't be making any money off you so they increase limits hoping you'll borrow more and get hit with their charges.

My CC limit doubled in a year without me asking for or wanting it to.

  [DELETED] 16:29 29 Apr 2006

Gold credit cards were introduced for people with salaries above £25,000 pa back in the days when that was regarded as a very generous amount.

Platinum cards were introduced for people of approaching millionaire status but, as (apparently) one must have a good excess of £3,000,000 to live a millionaire lifestyle, this has gone a bit beside the board and platinum cards are, or seem to be, offered to anyone who wants one.

There are, or used to be, some advantageous interest rates with these precious metal cards and good insurance deals for travel and similar things. I'm uncertain whether this applies now.

Be careful with credit cards - you pay an enormous interest rate, with them unless you clear them every month. I have one personal credit card with a personally imposed credit limit of £1,000 which I use for Internet purchases only - and that is cleared monthly. I have business credit cards which have to be cleared each month as part of the conditions of service.

  [DELETED] 16:32 29 Apr 2006

Platinum / Gold cards etc, normally differ from the 'standard' card in the extras that banks roll-up in them. 'Free' travel insurance is a classic add-on.
It is also a marketing ploy. Give a consumer a 'special' card and they are less likely to move card providers, as they think that they are getting a better credit card than others (this is generally untrue however).

Teaboy you don't say who your card provider is, but If I was you I would check whether the new card they want you to take has not got hidden charges (higher default charges or even worse annual charges).

  [DELETED] 10:15 30 Apr 2006

Thanks for the replies everone.

Edstowe explanation seems to be about right, with avelee mention of a market ploy support.

avelee- the card I refered to was issued be Morethan Insurance Co. backed by LloydsTSB, who pulled the plug.

It would seem that the cashback offer may have attracted sufficient custom for the bank to claw back the cash,(if you follow my pun!)

Oh well some you win....

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