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Credit Card Perks Come Roaring Back -- For The Middle Class

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A multi-directional tug of war is on between the banks, including Citigroup, JPMorgan Chase & Co., and Capital One Financial Corp.

According to Mintel Comperemedia, in the first quarter of 2011, “U.S. credit-card companies mailed 1.4 billion offers for new credit cards…a 69% jump from 826 million a year earlier.”

Along with these offers comes a goody bag of incentives, which tend to be aimed at US households earning at least $75,000 annually. The Wall Street Journal says, “Limiting the juiciest offers to consumers who kept up with their bills during the financial crisis is an effort to shield issuers from taking on too much risk.”

Right, the banks are watching out for us. I think I've seen this movie before.

In any case, let’s take a look at how juicy these offers really are.

Citi: According the WSJ, Citigroup, the third-largest U.S. credit-card issuer, recently offered Megan Bramlette, a credit-card consultant at New York's Auriemma Consulting Group, “a card with no annual fee for the first year and 50,000 frequent-flier miles on AMR Corp.'s American Airlines.”
JPMorgan Chase: This bank is on the prowl targeting affluent Americans. Recently, they “offered 100,000 frequent-flier miles to customers who qualified for a credit card co-branded with British Airways PLC.” Part of Richard Quigley’s, president of J.P. Morgan's credit-card unit, strategy is offering “attractive initial terms.”
Affluent and love to fly? Chase’s Continental OnePass Plus card pitch “offers of 25,000 frequent-flier miles, with the potential
for another 10,000 miles after the cardholder charges $25,000 a year.”
Capital One: Shockingly, frequent-flier miles will also be found in Capital One’s goody bag for new customers. This past month, Capital One upped the initial 10,000 miles to 25,000 for customers who sign up for their high end Venture card. The cherry on top: low interest rates. Capital One charges holders of the Capital OnePass card 14.23% interest, as compared to holders of the Standard Platinum card, who are charged 29.4% interest.
With these specifically crafted incentives, it's clear each bank is looking to pull the rug out from under their competitions feet.
But whether consumers are confident enough to sign up for new cards and start buying is still anyone's guess. According to today's news, it's doubtful.

See also: American Express Banks on Prepaid Card  and Can Big Banks Learn to Use Plain English?

Bonus: A look back at some recent history.
POSITION:  No positions in stocks mentioned.

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