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1. More sign-up bonuses – with more spending required. This has clearly been the case with cards like British Airways Visa Signature Card offering 100,000 miles and the Ink Bold Business Card offering 50,000 Ultimate Rewards points. As predicted, these product have large minimum spending requirements to earn the entire bonus.
2. More non-mileage perks. We have seen this happening on many cards. For example, in April the American Airlines card from Citi began offering first checked bag fee waivers, priority boarding, discounts on in-flight purchases, and a 10 percent discount on award bookings.
3. Fewer foreign transaction fees. This is happening, but slowly. For example, Chase recently dropped these fees on its Southwest Airlines Rapid Rewards Premier Card. Nevertheless, I’m disappointed more card issuers aren’t following suit.
4. The return of zero-percent balance transfers with no fees. Here, my predictions flopped. Thankfully, Chase continues to offer zero-percent balance transfers with no fees on its Slate card. But overall, we didn’t see a major comeback.
5. More attempts to lower credit card merchant fees – and kill rewards. Frankly, making this prediction was like speculating the sun will rise tomorrow. Merchants will try everything possible to cut their swipe fees. In 2012, a multi-billion-dollar legal settlement over credit card swipe fees was proposed, but this agreement is far from a done deal.
So where are we going in 2013?
I’ll give myself a 3.5 out of 5 for 2012. Let’s take a look at 2013:
1. Electronic payments. Credit card issuers will try to tie their cards to smartphone applications to make it easier for cardholders to use their phones for payments.
2. EMV smart chips everywhere. Right now, there are only a few credit cards that are compatible with a new system that is common overseas. (See Why Your Credit Card Might Not Work in Europe.) I think that’s about to change as banks roll out this system in larger numbers in 2013.
3. Big bonuses, but big hoops to jump through. I don’t think large sign-up bonuses are going away, but I believe credit card issuers will try to make sure you are using your card every day to qualify. Look for banks to give out bonuses in several stages based on spending or renewing your credit card.
4. Major changes to loyalty programs. Some of the major airlines are about to shake up their frequent flier programs, and this will have a dramatic effect on how we earn credit card rewards. Look for airline rewards to be more valuable to frequent fliers with elite status, and less valuable to infrequent travelers.
5. No change in interest rates. The prime rate has been steady for years, and there has been very little change in the terms of promotional balance transfer offers over the last year. Expect more of the same this year.