A national consumer survey, commissioned by American Express Travel Related Services Co., shows that cardholders are becoming more savvy about some credit card pricing issues.

But cardholders remain confused about how grace periods work, how much banks charge for late payments, cash advances, and fees associated with exceeding credit limits, the survey found.

Princeton Survey Research Associates conducted the telephone survey of 1,201 adults in March for its report, "Changes in Credit Card Practices and Perceptions."

American Express, in its third year of sponsoring a survey, is distributing the findings to 10,000 consumer advocates. The release of the survey comes as American Express, which currently offers the Optima card, prepares to launch a second credit card product this year.

Robert B. McKinley, president of RAM Research Corp., in Frederick, Md., speculated that American Express may market its new product as the "plainEnglish credit card" - an allusion to the company's contention that it does a better job than bank issuers of explaining fee structures.

More Cost-Cutting

More credit card users have been reducing their. costs by applying for low-rate products, paying their balances in full each month, or paying more than the minimum requirement; the survey found.

This year, 37% of cardholders reported that they canceled a credit card or received a new one, compared with 31% last year. Low-interest-rate cards were cited as the main reason for switching.

Fewer cardholders, 46% compared with 54% last year, are revolving their purchases, and 65% - up from 54% last year say they never pay just the minimum amount due.

Mr. McKinley believes that increased media attention and the efforts of consumer groups have caused the improvements in consumer behavior.

Consumerists should remain concerned about grace periods, ancillary fees, and promoting a greater sensitivity to interest rates, the survey found.

The survey shows that 76% of cardholders believe they have a grace period on all new purchases, even if an unpaid balance exists.

No Advance Planning

Also, 61% of cardholders do not know either whether or how much they would be charged for taking a cash advance. Similarily, 72% of cardholders do not know the penalty for exceeding their credit limit.

In addition, the survey points out that ignorance of interest rates is greatest among people who pay interest.

For example, 55% of cardholders do not know how much interest they were charged on their last statement, and 40% do not know their annual interest rate.

A survey commissioned by Visa International found that two out of three cardholders are aware of special offers, rebates, and rewards tied to credit cards.

Hase Schannen Research, Princeton, N.J., conducted the telephone survey of 1,000 people nationwide in March. The study found 57% of cobranded cardholders rank benefits associated with card use as the most important factor in selecting a credit card, compared to 48% of all cardholders.

And, 49% of cobranded cardholders use their cards more than four times a month, compared to 40% of cardholders in general.

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