2019 Credit Card Trends and What They Mean

The stable economy of 2018 has led to the development of several new incentives by credit card companies. These include increased entertainment and dining rewards, as well as new payment options with retailers.

Heading into 2019, these developments are set to become more widely available for current credit card holders, and encourage consumers to apply for new cards in the New Year.

While most of the credit card trends heading into 2019 hold positive prospects, consumers can anticipate higher interest rates as well. This proves challenging for those who have amassed a large credit card balance, as it is going to become more difficult to pay off the debt once the increase takes place. Preparing for the credit card trends of 2019 is essential if you are hoping to maintain a positive credit score heading into the New Year.

Entertainment and Dining Rewards

Several credit card companies are seeking to improve their entertainment and dining rewards heading into 2019. One of the companies leading this trend is Wells Fargo, which recently implemented the Wells Fargo Propel American Express Card. This new AmEx card is designed to provide consumers with triple the earned points when used for dining, travel, streaming services and transit.

In fact, customers who hold the Wells Fargo AmEx receive triple points for dining regardless of whether they choose to dine out or order takeout, as the card provides rewards for both options. The current terms for this program promise one point earned per dollar spent on these main categories.

Related article: How to Find the Right Credit Card for You

Similarly, Capital One launched the new Savor Cash Rewards Card and the SavorOne Cash Rewards Card to provide customers with added rewards for dining and entertainment purchases. The Savor Cash Rewards Card offers standard rewards for members who dine out or use their card to purchase tickets to events such as movies or concerts. Meanwhile, the SavorOne Cash Rewards Card provides a bonus reward for customers who use this card on dining and entertainment and does not charge an annual fee.

Contactless Payment Options

Another growing trend in 2019 is the option of using contactless payment at select retailers across the country. With contactless payment, you are not required to swipe your credit card or insert the credit card chip when you are making a purchase at a brick-and-mortar store. Through this futuristic development, all you need to do is simply tap your card against the point-of-sales system to complete the transaction.

With the introduction of contactless payment, the process of making a purchase at a store is streamlined significantly. It is also considered a more secure option, though it eliminates the need for entering a pin number or providing a signature for certain purchases. There are a few restrictions to this optimization, as some companies provide a limit to the amount you can pay with contactless payment, as well as the number of transactions you can perform with this feature as well. Both Chase and Capital One currently offer contactless payment options for existing customers, though many companies are expected to follow suit with this trend as the year progresses.

Increased Interest Rates

One of the negative trends for credit cards heading into 2019 is the increase in interest rates. Interest rates commonly rise over the course of the year, meaning your credit card balance may gradually become steeper. If you consistently carry a balance on your credit card, a higher interest rate means you are going to pay more toward your card with each payment. For those struggling to make ends meet, this can lead to further financial trouble as debt continues to rise with each delayed payment.

Related article: 6 Tips to Help You Pay Off Debt

To avoid this issue, try to pay down as much of your debt as possible before the interest rate increase takes place. If you are struggling to get out of debt, consider the idea of transferring the balance on your current credit card to a card providing a lower interest rate. Ideally, cards offering a zero percent APR are best, as these cards are designed to help you pay off your existing debt without accumulating additional interest in the process.

However, keep in mind that these cards typically offer an introductory period. This means your zero percent APR may be temporary, and followed by a fixed interest rate once the introductory period elapses. Therefore, it is essential to pay off your debt during the introductory period after you have made the switch to receive the full benefit of this feature. Otherwise, you may wind up in the same position you were in before you transferred your balance to a new credit card.

Co-Branded Credit Cards

Many popular retailers are also banding together to offer customers a co-branded credit card in 2019. Two of the companies leading this trend are Ikea and Starbucks. These companies recently decided to offer their mutual customers a co-branded credit card, which offers added rewards when visiting these stores.

Co-branded credit cards are the result of an agreement between a retailer and a credit card company or network. Due to the partnership, customers receive additional rewards when using this card at these specific stores. However, it also functions like a regular credit card outside of this specific retailer as well.

For example, if you purchase a co-branded Starbucks credit card sponsored by Visa, you are permitted to use this card to make a purchase at any retailer that accepts Visa cards. However, you may not receive rewards for purchases made on this card outside of Starbucks. This rule may vary depending upon the company you receive your card from, and what deal they have worked out with the bank or card network.

It is important to note that these cards typically carry higher fees and interest rates than other credit card options. However, the benefits provided may outweigh these added expenses for customers who frequently shop at these destinations. Co-branded cards are also more beneficial for the company, as customer loyalty increases when the additional rewards are provided. In general, it is best to thoroughly examine the deal and your finances in order to decide if a co-branded card can benefit you in the long run.

Related article: Low-Interest Credit Cards

It might also interest you: