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By Amy Rich
Staff Writer, 4 March 2008
160,000 Egg credit card holders have recently had their cards withdrawn, but should you let that get in the way of your decision to take out an account with them?
The policy change: what happened?
At the beginning of this year, Egg, somewhat controversially, changed their policy of whom they would and whom they wouldn't lend money to.
The outcome of this policy change was that many Egg credit cardholders were given short notice of a withdrawal of their borrowing facilities and accounts at Egg.
Sadly, this has left many of their customers feeling angry, and while Egg's recent withdrawal of many credit card accounts was supposedly aimed at those account holders with a higher risk profile, many cardholders who believed they had an excellent credit rating and consistently paid off their balance in full each month were still hit.
While Egg's actions have been under question by consumer bodies and members of parliament, the implications that Egg has discarded customers because they are not profitable enough remains open and the outcome has not been positively challenged.
What does it mean for new customers?
New Egg customers won't be affected by Egg's recent policy overhaul. Pure and simply, that means, if you apply for an Egg credit card and you're accepted, you can rest assured it will be very unlikely that your account will be closed in the near future.
Egg, for a long time now, have been a favourite with us here and if you're a new customer looking for a credit card, it's fair to say, Egg are still fighting their corner with great incentives, and topping the best buy tables for 0% balance transfers.
Here's the breakdown:
New Egg customers can expect -
- % APR (variable)
- 0% interest on balance transfers until (% handling fee)
- 0% interest on purchases - until
- Anniversary offers - 0% for up to 5 months on balance transfers made in March 2010 and March 2011 (2.5% handling fee)
- Cash back and discounts galore on online shopping (e.g. 25% off at Virgin Wines, 5% off at Dixons and 5% cash back at lastminute.com)
The Egg credit card is one of the best plastic options for transferring existing card debt to a 0% rate, with their offer lasting for - as one of the market-best - 14-months.
It's certainly still an offer worth opting for, and as long as you stick to the standard 0% rate usage conditions, i.e. pay at least the minimum required on time each month and keep within your credit limit, you shouldn't have a problem benefiting from the full length of this deal.
What's more, applying for an Egg card promises to be quick, easy and painless - with it all done online in minutes. And if you're constantly battling the war against paper, then you'll be happy with Egg's no paper policy. Statements are all electronic, but if you’re one for endless filing, then you'll have to pay for the privilege. Each statement costs £2.
So, can Egg be trusted?
Whether or not Egg is trustworthy requires an open perspective look at the background of what's been happening.
Egg was recently bought out by Citibank, any big company move over like this expects big company changes to go with it, and a policy change of acceptable customers (while it has caused controversy) is not that surprising.
The credit crunch is also still largely affecting financial institutions around the world, and all bank's lending policies are being tightened up affecting who they will lend money to as well as how much.
The credit crunch is also a result of the loss of cash flow of the banks themselves, so while it may not be all too ethical and consumer friendly, cutting down on 'loss-leader' customers would perhaps be seen in a different light if the company was operating in a different market.
Suddenly having your credit card account withdrawn for no good reason is certainly not something any of us want to happen, however it has even been mentioned that those people who actually did have a good to excellent credit rating would certainly not suffer any credit tarnishing and may in fact get a few points added on to their scores.
So, Egg's actions, if they were ever to happen again, are not something that could cause anymore harm to your financial status or credit history, than the personal nuisance and inconvenience of having to open another account.
And, if I'm still unsure?
If you are still unsure, then there are other places you can go for market-leading credit cards.
For example, there are two other cards out there at the moment that are scoring close to Egg in the balance transfer division, and that's Barclaycard's Platinum credit card, Mint credit card and the Virgin credit card. Here are their benefits at a glance:
Barclaycard Platinum credit card:
- % APR (variable)
- 0% interest on balance transfers for months (% handling fee)
Virgin credit card:
- % APR (variable)
- 0% interest on balance transfers up to months (% fee)
Mint credit card:
- % APR (variable)
- 0% interest on balance transfers until (% fee)
Egg have clearly lost points in the customer confidence stakes, and while their balance transfer offer is still one of the best available they might just have to work a little harder now they've got 160,000 angry customers spreading the word.
 Egg credit card review
Compare 0% balance transfer credit cards
 Credit card guide
Credit card features archive
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