Cash back credit cards on the decline

By UK CreditCards.com

Cash-back credit cards decline in popularityCash back credit cards have declined in popularity considerably during the past six years.

Financial data company Defaqto conducted research which showed that just 4.8% of credit cards currently being used in the UK include a cash-back scheme, the Independent reports.

This compares to a total of 28.2% recorded in January 2004, while the presence of credit card deals with points schemes and airmiles has increased in the same period.

David Black, a banking expert at Defaqto, said he believes that this trend looks set to continue in the coming years. "The card providers will seek to recover lost income by a combination of increasing rates, introducing annual fees, less generous introductory offers and reining back on reward schemes," he told the newspaper.

Mr Black added that some companies will set caps on their cash-back credit cards, or possibly only offer enhanced cash-back with certain retailers.

The research comes after Barclaycard announced earlier this month that it will launch a loyalty credit card scheme in March which provides its customers with "rewards money."ADNFCR-2308-ID-19589596-ADNFCR

Published: 4 February 2010