Credit card points, pie in the sky


By Hyok hee kwon

I bet most of you have at least one credit or debit card. According to official data announced by the Bank of Korea, every economically active person in Korea has at least 4 credit cards. I guess all of you have some kind of your own standards when choosing a credit card or a debit card but most of the people responded that additional functions provided by credit card companies are the biggest criteria. In my case, I take a look at design of the card, discount benefits and so forth but just like everyone else additional functions (accumulated card points or cash back services) are the most important factor when signing up a card. One of the most common optional services credit card companies provide you is that as you use make certain amount of payments with the card, they save certain amount of points that you can use in affiliated stores such as theaters, supermarkets, bookstores and a lot more.


But the points that are saved in your credit cards have lots of dilemma on the other hand. For example, one day, a college student A, received a notice saying that the points A has been saving will be gone. But A had no choice but to give up all the points he has been saving because credit card companies set limits on the points that A can use at a time or because places he can use those points are too far away from where he lives. What’s more, he had to pay extra money to use the points he has. Credit card companies promote point saving as the flagship function but as mentioned above, there are lots of restrictions to use those points. Such restrictions include policies which require the card holder to make certain amount of payment using the card to spend the points and set limits on how much a holder can use the points at a time. Credit card companies say that such limits are a part of their marketing plans to make customers visit their affiliated stores and spent more money there.


Currently, it is estimated that about 2 trillion worth of credit card points will disappear soon. According to the Financial Supervisory Services, the number of civil complaints on credit card companies is growing exponentially. The Financial Services Commission and credit card companies formed a task force to respond to those civil complaints swiftly and actively. Of course, the rapidly increasing number of civil complaints does not only fall into the credit card points mentioned above but also includes reckless telemarketing or acts of luring customers to sign up for credit card.

Many renowned economists predict that the credit card industry would become even more difficult because the credit card market in Korea is already saturated. It is time for credit card companies to observe moral responsibilities and ponder about new marketing plans or strategies to improve profit.


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