Credit Card Issuers Lose Market Share Due to Existing Cards

Credit card issuers face a worsening situation as customers increasingly choose to use a card they already have as their primary card, rather than a new one. According to the report "The Switching Trigger" by PYMNTS Intelligence, prepared in collaboration with Elan, 58% of consumers who changed their primary credit card in the last two years did so by selecting only a card they already had. Meanwhile, 42% obtained a new card for this purpose. In the United States, 78 million adults, representing 36% of credit card holders, have changed their primary card at least once in the last 24 months. Of these, 52 million did so more than once. Over the past 24 months, 71% of consumers identified their new primary card in less than a month, 17% made their choice in less than a week, 29% took one to two weeks, and 25% took three to four weeks.

When choosing a card, consumers tend to limit themselves to a small number of options. 38% considered only the card they selected, while 40% compared it with only one alternative. This means that 78% of clients seriously considered no more than two cards. Among those who switched cards, 38% said they chose another card due to a more favorable rewards system, 36% noted a higher credit limit, 30% cited a sign-up bonus, 26% mentioned improved travel conditions, and 24% preferred better mobile or digital service.

The issue is that card issuers may not receive immediate notification from clients about changes in their preferences. 46% of those who switched cards did not contact their previous issuer before changing cards. 37% of them initiated contact themselves, 20% stated that the issuer's offer was insufficient, and 17% received no offers or solutions. Only 17% reported that the issuer initiated contact. Among the 335 clients who received a retention attempt, 32% were offered a fee waiver or reduction, and 31% were offered statement credit or cash back. Among all who switched cards, the leading responses on what could have retained them were: a significant loyalty or retention bonus – 25%, a higher credit limit – 24%, and a comparable or improved rewards rate – 23%.