American Express has announced that, from this week onwards, it has decided to stop offering new customers special balance transfer rates.
The move is a significant one, according to price comparison website uSwitch.com, as it means that it could be the first nail in the coffin for rate-chasing credit card consumers.
Nick White, head of personal finance for uSwitch, said: "American Express' decision to stop offering balance transfers to new customers is a major development, which could signal the beginning of the end of the rate tart phenomenon that has dominated the credit cards landscape for the last two years.
"Two of the balance transfer offers that are being withdrawn for new customers - the Nectar Amex 5.9 per cent life of balance and the Blue Amex 6.9 per cent life of balance – typified the type of offer that consumers have become used to seeing from the major credit card issuers over the last couple of years as they have fought for market share."
Mr White said part of the reason was the Office of Fair Trading report that called on card providers to reduce their default charges and that the move to scrap the low-rate offers was a cost-cutting measure.
"While these deals were very competitive for consumers, they came at a cost to the credit card industry, which was losing an estimated £600 million a year overall in revenue from balance transfer offers."
Special introductory offers can still be found on the market but uSwitch urges consumers to move quickly to snap them up as this could be the first in a line of offers being withdrawn.To read more about credit cards, click here.
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