THE ULTIMATE SOPHISTICATION IS TO BE SIMPLE
Our research across several hundred customers raised the same concern: customers are not happy with multiple hidden conditions and find it inconvenient to have to track three different criteria to be met before they can get hold of that ever-elusive cashback.”
Credit cards have significantly transformed and are now taking newer non-plastic forms, sitting inside mobile phones, personal devices and in the cloud. We anticipate the increased usage of convenient technologies that may eliminate the physical manifestation of the card. Yet, the core functionality of a credit card does not change much. Cards provide credit to customers and deliver value back to customers through attractive reward programmes.
From a customer’s point of view, the UAE market is one of the best in the world. With a relatively small population and 20 plus credit-card issuers, it’s understandable why banks are trying everything imaginable to attract customers to their products. And there are some fine credit cards out there: a few offer loyalty points, others offer Air Miles, while many offer cashback.
Common question
I often get asked (much like Google) what is the best credit card in this market? And I have to say, “It depends…”
Everyone is looking to get something different out of their card — some look for just a payment instrument, others want a temporary credit line, some want discounts, some like points and some like miles or cashback. Globally, cashback cards have become a big part of card propositions. By our internal estimates, more than a third of customers globally have at least one cashback card in their wallets and phones.
Coming back to the challenge of a heavily competitive market: some banks are tempted to compete with headlines like
“10 per cent cashback”, but with many conditions that make it difficult to achieve. These terms and conditions almost always overpromise and ultimately, under-deliver.
Personally, I prefer cashback as a reward. It eliminates the hassle of keeping track of reward points and figuring out ways to redeem them, I get money back straight into my card. I wanted to design a card that I, and many others like me, would love to have.
Something that has a high level of generosity, is simple to understand and doesn’t make you jump through hoops to get it!
Our research across several hundred customers raised the same concern: customers are not happy with multiple hidden conditions and find it inconvenient to have to track three different criteria to be met before they can get hold of that ever-elusive cashback. This becomes more relevant in today’s digitally connected world when we design products for millennials, who are now a major target market.
In fact, according to data from the Youth in the UAE survey published from Visa, millennials and Gen Z comprise around two-thirds of the UAE’s current population and frequently shop online. Furthermore, research also found that one in every five dollars spent in the UAE goes towards food – and food spends continued to grow in 2019.
No-hassle cashback
This research also indicated that more than half of our target market would prefer a simple, no-hassle cashback proposition. Customers preferred the Mashreq cashback credit card for reasons like the unlimited cashback — no minimum and no caps.
Add to that the fact that there is no annual fee, for life, along with a 5 per cent cashback on dining spends, and its appeal is clear to see.
The response from our customers has been tremendous. Early indicators show that over ten thousand people applied for this card within weeks of launch. We have also seen that they are activating this card and using it 50 per cent more than our other products.
I am proud to say that any UAE resident can apply for their credit card 100 per cent digitally. No need to schedule an appointment, visit a branch, or wait for a salesperson to visit you. We will not ask for any papers, application forms, bank statements, payslips, or security cheques. No stamps, no signatures.
Finally, irrespective of the card you choose, it is important that you fully understand the terms and conditions and maintain a spending pattern that is financially sustainable for you. In my opinion, the simpler the card’s offering, the better it is. A bank that makes it easy to understand what customers should expect will ultimately win the battle for customer’s hearts and wallets.