Consumers Have Fewer Gripes About Credit Cards

Consumers' satisfaction with credit cards is improving, but that doesn't mean they're happy with their current plastic, according to a new study.

Overall satisfaction with credit cards is up slightly to 714 on a 1,000-point scale, from 705 in 2009, according to the annual J.D. Power and Associates 2010 U.S. Credit Card Satisfaction Study. The study polled 8,500 credit card customers regarding six key factors: Interaction with card companies, card terms, billing and payment, benefits and services, rewards and problem resolution.

American Express (AXP), Discover Financial Service's (DFS) Discover Card and US Bancorp's (USB) US Bank were the only card issuers to earn above-average satisfaction ratings, while Wells Fargo (WFC) came in on the average of 714. The worst were HSBC (HBC), which scored 686; Citigroup's (C) Citi Cards at 692; and Capital One Financial (COF) and Bank of America (BAC) with 699 each.

American Express, which again placed first in overall satisfaction as it has for all four years of the study, rated high across all categories. According to the study's authors, the top performers in the poll all offer attractive customer rewards, superior service by telephone or online and handle problems quickly and with minimal effort.

"It Could Have Been Worse"

The new federal law governing credit card practices -- the Credit Card Accountability Responsibility and Disclosure Act of 2009, also known as the CARD Act -- is having an effect on customers' satisfaction, even though many cardholders have seen their rates shoot up since the start of the recession. The survey found card customers seem more satisfied overall with card terms and their billing and payment process, according to the study's authors.

Not coincidentally, customers who carry a balance on their monthly charges, known as revolvers, showed some increase in satisfaction, while those who pay in full were slightly more negative.

"It appears that revolvers are expressing a perception that 'it could have been worse,'" said Michael Beird, director of banking services at J.D. Power, in a statement. "Revolvers, who tend to be more sensitive to fees and rates, are significantly more likely to say that CARD Act disclosures improved their understanding of their credit card terms."

However, the average consumer is still suspicious of credit card companies. An analysis of online comments and social media threads by J.D. Power showed customers feel they're in a cat-and-mouse game with card issuers. The percentage of consumers who are shopping around for other cards keeps growing. And respondents who said they won't switch cards in the next year dropped to 22% from 25% in 2009 and 30% in 2008.