"The whole concept of what a credit card is has changed," said Stuart A. Feldstein, president of SMR Research Corp.

The Budd Lake, N.J., firm, in its recently released annual report on card profitability, concluded that credit cards go far beyond their historical benefits of credit and convenience.

"Now a credit card has to give credit and it has to be handy," said Mr. Feldstein. "It has to help you buy a car or a house or give you discounts on telephone calls or free airplane rides."

He said cards with rebates and low rates. called "high-value cards" in SMR's 1993 credit card report, will account for 25% of general purpose cards by the end of the year - and more than half of all cards "within a couple of years."

"The growth comes from stealing market share." he said. "Account attrition and churning has rarely been higher, and we think it's going to continue as these high-value accounts replace other accounts."

Sears Led the Way

Mr. Feldstein traced the value phenomenon to 1986, when Sears. Roebuck and Co. introduced the Discover Card, which carried no fee and offered rebates of up to 1% on purchases.

Then came such offerings as the AT&T Universal Card, a no-fee card that offered long-distance discounts, the General Motors card. launched in September by the automaker and Household Bank, Salinas, Calif.

The no-fee GM card pays a 5% rebate, which consumers can use toward the purchase of a car.

Mr. Feldstein said the incentive for consumers to use the card instead of cash or another card translates into additional transaction fees to the bank.

What's more, chargeoffs will tend to be lower on the GM card and other high-value cards because consumers are less likely to default when they risk losing the rebates.

He predicted a mortgage rebate card from Wells Fargo & Co. and a NationsBank Corp. offer that allows cardholders to build annuities will be widely imitated.

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