The new Coles Myer card
Late in 2001 Coles Myer replaced its customers' department store cards with “private label” credit cards, in a joint venture with US-based finance company GE Capital.
Infochoice advises customers to use store cards such as the Coles Myer Card with care, due to their high interest rates. “Use them for specials and loyalty benefits”, says Sean McIntyre, “but pay them off in full by the due date”.
Five years ago, spending on the Myer Card or Grace Bros Card accounted for a significant portion of Myer and Grace Bros sales – almost 30%. By 2000 this had declined to 17%, with a drop in cardholder numbers from over four million to fewer than two million in 2001. Part of the reason for this was that the cards had very high interest rates and customers starting switching to standard credit cards.
So late in 2001, Coles Myer and GE's new card, the Coles Myer Card, replaced six store cards. The new card, not to be confused with the Coles Myer discount card for shareholders, can be used in 1,800 retail outlets covering 21 businesses with the exception of Red Rooster.
How does the Coles Myer Card differ from ordinary credit cards? Firstly, you can't use it outside the Coles Myer chain; it has an interest rate of 21.9%, compared with a typical credit card rate of 15-16%; it offers up to 62 days interest-free, which can give you one month of free credit; it cannot be used to access cash at ATMs; it can't be used for EFTPOS at other stores.