June 09, 2010
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News: Egg Launches New Visa Credit Card
On Monday, Egg Banking plc, the British Internet Bank launched its new Visa credit card. Egg, headquartered in London, England is the world's largest internet bank. The bank operates solely on the internet; therefore, if an individual wants to open an account with Egg, he will need internet access. In addition to its credit card business, Egg offers a variety of banking services including savings accounts, loans, and insurance products. Although the new Visa credit card offers an average annual percentage rate (APR) of 17.9 percent, it does offer a zero percent interest on new purchases until September 1, 2010.
Credit card customers wanting to save interest from those higher interest rate cards can take advantage of the Egg Visa card which offers a zero percent interest until August 1, 2011 on all balance transfers completed by September 1, 2010. A fee of three percent will be charged on the amount of the balance transfer. The zero percent offer is only for new customers and is not approved from credit cards or loans provided by Egg or any group affiliated with the company. The Egg Visa card rewards customers with a 10 percent cash back that may be redeemed at the Egg Cash Back Store featuring over 1500 selected online merchants. The card also comes with an internet delivery guarantee and purchase protection insurance.
Egg banking has undergone a great deal of controversy during recent years when in early 2008, the company cancelled a large portion of its credit card giving cardholders only a 35 day notice. According to Egg, the cancellations were necessary to eliminate high risk accounts. However, after a significant number of cardholders complained saying they had excellent credit, speculation turned to thinking the move was an attempt to cover up the company's real motive which was to eliminate cards with zero balance that were not bringing in any interest income. After being fined later on in the year by the Financial Services Authority for deceptive marketing techniques of payment protection insurance (PPI) on its cards, Egg turned to more sophisticated methods of eliminating risky and less profitable cardholders by increasing interest to the legal maximum rate.