American Express and Discover tied for the highest ranking in credit-card customer satisfaction, according to the newly released J.D. Power 2014 study.
J.D. Power stresses that the two credit card issuers have very different business models, but each have earned high marks from their customers. (See chart below.)
American Express offers 21 cards targeting various customer segments, with some cards carrying annual fees and a wide range of cash-back to travel rewards. AmEx customers tend to be more affluent, and they spend more but are less likely to carry a balance than customers of other card issuers.
Discover’s strategy is more focused on a single card with cash-back rewards and no annual fees. Its customer base is broader. Discover offers tools to customers to help them better manage their money and the company is the first card issuer to provide credit scores free of charge, an option that other issuers unfortunately have not picked up.
The J.D. Power study is now its eighth year. It measures customer satisfaction based on six factors: interaction; credit card terms; billing and payment; rewards; benefits and services; and problem resolution.
Overall, satisfaction is at a record-high of 778 on a 1,000-point scale in 2014, surpassing the previous high of 767 in the 2013 study. American Express, which ranked highest in each of the eight years since the study’s inception in 2007, and Discover each achieved a score of 819.
“This is really a tale of two very different credit card companies that both excel at customer interactions,” said Jim Miller, senior director of banking services at J.D. Power. “American Express and Discover provide great personal service when customers call in and also make it easy for customers to manage their accounts online as well as by using mobile apps.”
Only 11 percent of customers report a problem with their credit card, but the most common issue is unauthorized or fraudulent activity, which accounts for 21 percent of all problems. However, when these problems are properly handled, credit card companies can turn a bad event into a positive customer experience, J.D. Power said.