Do customers really think in terms of cards or loans?

Visit any price comparison website and you will quickly be funnelled into a comparison of either credit cards or loans. They are treated entirely separately and assume that the customer has a clear need for one product type or the other.  

Break with Tradition

There are obvious differences between credit secured from a loan and from a card in terms of the release of funds and the repayment or revolving nature of the facility. Also, it has traditionally been the case that cards would service customers with lower borrowing amount needs, loans the higher amounts.  

Blurred Lines

Recent product and market developments have blurred these traditional lines of separation. It is now possible to secure a loan which offers credit on a revolving basis (ie. can be drawn down as needed). It is also possible to take a ‘money transfer’ credit card from which can actually release funds to you for transfer into an account. Micro-loans are now also increasingly being offered to customers for amounts greater than £1,000 and high-credit-limit cards are available for prime customers offering limits of tens of thousands of pounds.  

Record Breakers

With both loans at record low rates (<3% APR) and credit cards offering record balance transfer periods (>39 months) there are great options for customers on either side of the fence.  

Leader of the Pack

It is important that anyone offering consumer credit tries to understand the customer need and offers the best products that the customer is eligible for across the spectrum of cards and loans. At TotallyMoney we continue to develop our customer experience inline with this and are working hard with our credit card partners to develop greater transparency on the actual credit limits being offered to customers earlier in the customer journey – such that our customers can make better, more informed choices across credit cards and loans.