Countdown enters credit card market
Supermarket chain Countdown has launched a tap-and-go Visa credit card backed by finance company GE Capital, the grocery giant's first step into the New Zealand financial services sector.
Shoppers who want a supermarket-branded credit card will pay a $48 establishment fee and a $65 fee annually, up to $41 more annually than the cheapest major bank credit card.
Card holders hunting loyalty points will receive double supermarket rewards on any purchases made at Countdown using the credit card, which doubles as a Onecard loyalty card.
That equates to approximately $30 worth of vouchers per $2,000 spent at Countdown for any points used before expiry.
Card holders will also be able to earn Countdown points on purchases at other stores, says Countdown managing director Dave Chambers.
It follows the launch of a credit card by Countdown's Australian parent, Woolworths, which attracted shoppers with an introductory nine months' interest-free on purchases and one year waiver of the A$49 annual fee.
Chambers said Countdown had decided not to offer a similar interest-free deal here as it wanted to be seen to be responsible and not encourage excess consumer debt.
Annual fees for credit cards from the four major banks range from $24 to $44, according to bank websites and latest rates at interest.co.nz.
However holders of the cheapest cards often pay extra if they want to earn rewards points - for example ASB's $24 annual fee rises to $44 for rewards points earners.
At $65 the annual fee is $17 higher than other, Gem Visa-branded, store credit cards offered by GE. However there is a more competitive interest rate of 19.99 per cent on purchases, the equivalent of most major banks.
Customers will be able to tap to pay for purchases under $80 using the tap-and-go technology that is being rolled out by rivals Visa and
Mastercard at supermarkets, petrol stations and other retailers. Chambers said the average purchase at supermarkets was under $80 and he had personally trialled the tap technology at Auckland stores.
Countdown is installing the Visa payWave technology, in which transactions are processed with a wave of the card over a terminal, at all Countdown stores nationwide.