Now that banks can’t charge overdraft and other debit card-related fees, the race is on to attract high net worth clients whose fees will make up for those lost.
Exhibit 1: Banks are creating fancy new credit cards to attract high net worth customers.
Wells Fargo announced yesterday that it was testing out microchip-embedded credit cards with 15,000 of its wealthiest clients.
And JPMorgan’s high net worth clients who use the firm’s Palladium credit card — made of palladium and 23-karat gold (which launched last May and “produces a distinctive trill as it hits the table at a restaurant”) — will get a similar new chip within the next three months.
More on the Palladium card is available by clicking here >
The microchips are so in-demand that it’s become a race. JPMorgan’s general manager for Chase Card Services said, “Absolutely, we would beat Wells Fargo to market,” Bloomberg reports.
What’s cool about them is that the EMV-chip allows people to travel overseas problem-free. The EMV chip “has become a standard in Europe and much of the rest of the world,” but the US is yet to adopt the technology, and credit-card acceptance problems overseas cost card issuers millions of dollars.
So JPMorgan and Wells are both targeting their wealthy clients — many of whom have issues with their magnetic stripped credit cards when they’re overseas.
“The chip cards may boost transaction revenue and help JPMorgan lure affluent customers from rivals such as American Express,” JPMorgan told Bloomberg.
While Wells’s pilot program includes clients who travel regularly, from private-banking clients to college kids, JPMorgan will only offer their card to their most moneyed clients to begin with: “Initially, we are targeting the technology to our highest-spend clients. Months after that we will issue the card to Chase-branded products.”