September 14, 2010
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News: Sainsbury Launches New Gold Card
Sainsbury announced the launch of its new credit card which pays cardholders back for using the card. The Sainsbury's Gold Credit Card offers a low interest rate of 9.94% on purchases and interest free cash withdrawals. Sainsbury will also provide travel insurance for two adults and up to six children when travel expenses are charged to the its new Gold card. There is no foreign exchange transaction fees or cash advance fees in the UK or when traveling abroad. Cardholders will receive double points for all Gold credit card purchases make in stores, online, and in its sponsored gas stations. Sounds like a fabulous deal, however, there is nearly always a catch.
Cardholders who acquire a Sainsbury Gold Credit Card will receive a monthly fee of £5 (or approximately $7.50 in U.S.) a month if they want to reap in all the benefits of the card. Some experts feel cardholders will not be willing to pay the fee especially since they have not been used to paying a fee. However, there are currently approximately 20 credit cards on the market that do charge a fee which include the American Express Centurion and the invitation-only card from Coutts World Card. Typically, these annual fee cards target the more affluent cardholder who is willing to reach into their pockets to pay for the added benefits of such card.
It appears that Sainsbury is looking to take on their competitors Capital One which offers the World MasterCard and Egg which offers the Money World MasterCard. Both cards offer a 1 percent cash back reward on all purchases and charge a monthly or annual fee. The company acknowledges that it has challenges to overcome in the launch of its new credit card; the greatest being convincing the customer that the benefits will far outweigh the costs. The company expects it sizeable market of travelers will see the value in the travel insurance and the out-standing quality of the product.