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Note: The "activation" I am talking about here is not the same as the "activation" in this question.

I just got a Chase Freedom credit card, mostly for the 5% cash back rewards.

I had seen that every piece of promotional literature referred to "activating" my rewards, so I was expecting some difficult process. Instead I logged in to the website, clicked a single button, and my rewards were on.

Edit: As of Sept 19 2015, I now have to type in my last name, last 4 digits of my card, and my zip code...all of which are things that Chase already knows about me. Could be confirmation bias, but I have to wonder if the high ranking of this question on Google had anything to do with it.

Considering the ease of the process, why does Chase require cardholders to do it at all?

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Steve V.
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3 Answers3

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They make you do it (click the mouse a few times to activate the rewards) because X percent won't do it. Those that don't click get nothing.

If it was automatic people who didn't make an effort would accidentally get a benefit. But If you are aware of which category gets the bonus you might make an effort to boost your reward. Of course that extra usage will cost them more, but it also may help their bottom line because of the additional fees and interest.

mhoran_psprep
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In addition to mhoran's answer, I think it's a behavioral thing. It makes it seem like it's a benefit if you actually have to click around and do something, whereas if it was just a universal thing that always existed you might take it for granted.

So every few months it's like you get something "new". Usually "new" benefits comes with unplanned spending, which is exactly what they want.

bigpotato
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Here are a few possible reasons:

  • As already mentioned in mhoran_psprep's answer, the card provider can save money if people don't sign up, while continuing to advertise that they give a 5% rebate (or whatever benefit).

  • They may use this to get you to do things that help them. For example, they may ask you to switch to electronic billing if you still receive paper bills through the mail.

  • They may try to get you to use their other products and services, and sometimes those of their "partners" (companies they team with to provide some of these discounts, rebates, etc.).

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GreenMatt
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