Many credit cardholders already have been hit with higher interest rates on their cards in the wake of the economic meltdown, and industry analysts anticipate that credit card reform also may lead to more annual fees and stingier mileage or cash-back perks on rewards cards, as has been reported by The New York Times and The Wall Street Journal.

For the moment, however, at least one major card issuer is bucking those trends.  In a recent mailing sent to some of its United Mileage Plus Visa cardholders, JP Morgan Chase actually offered to lower the purchase interest rate on the card to the prime rate plus 7.99 percent, or 11.24 percent.  down from a rate of 13.49 percent for the cardholder account we examined. The lower variable rate would kick in during the July billing cycle and last for 12 months. 

The promotional letter announcing the new terms hints at Chase’s intent:  “Now if you use your United Mileage Plus Visa card to make all of your purchases—including those that life can throw at you unexpectedly—your new lower rate can lead to smarter borrowing decisions.”  Motivating cardholders to use the card more frequently obviously generates more transaction fee income for Chase at a time when many consumers are cutting back on using credit cards.

Chase also underscores the other comparative advantage it is providing that could motivate consumers to use the card more often:  “You’ll still earn miles for all of your purchases—even at a time when other rewards programs may be cutting back.” 

It remains to be seen whether other card issuers will follow suit by offering similar lures to encourage cardholders in good standing to charge more on their cards.  Even if they do, however, to be on the safe side, our previous advice about stockpiled reward points still stands: use them before you lose them.—Andrea Rock