Wells Fargo revamps premium card to compete on rewards
Wells Fargo & Co. is finally going after the young and points-hungry by boosting rewards on one of its premium cards.
Two years after JPMorgan Chase & Co. launched an arms race in credit-card rewards with its Sapphire Reserve card, Wells Fargo will now offer three points per dollar spent on dining, travel and streaming services such as Netflix on its Propel card. Other purchases will earn one point per dollar, and points are redeemable at one cent per point.
Boosting market share in credit cards is one of the bank’s priorities to increase profitability while operating under a punitive asset cap imposed by the Federal Reserve this year. Though it’s the biggest bank by interest-bearing U.S. deposits and the top issuer of debit cards, Wells Fargo is just the 7th-largest credit-card issuer, according to the industry publication Nilson Report.
“No annual fee is, in our mind, a market-maker,” Beverly Anderson, Wells Fargo’s head of cards and retail services, said in an interview. “Whether it’s taking the subway to work or getting your favorite coffee or taking your friends out to lunch or dinner, that’s pretty powerful.”
Since taking over the unit last year, Anderson has been pushing to increase Wells Fargo’s slice of the $183 billion in fees and interest that banks earn from credit cards. The bank began targeting non-customers in the U.S. with mailed credit-card offers earlier this year.
The Propel card will continue to be processed on American Express Co.’s network. Anderson said that the Propel World card, a card in the same line with an annual fee, will be revamped over the next couple years.