Household International Inc. is heating up the credit card market in the United Kingdom by offering a card with British Gas.
The new product, marketed as the Goldfish Card, has the potential to catapult Household's card presence in the United Kingdom, where it already has 650,000 customers in its General Motors program, established in 1994.
British Gas serves 19 million homes and, until recently, monopolized the market.
"It is a novel idea," said Howard Radley, vice president of financial services for Gemini Consulting in London. "By locking in British Gas, they virtually have every household in the United Kingdom, because everyone uses gas."
Household Financial Services Bank, Household's U.K. arm, likely will have access to the names and addresses of the utility's customers, as well as access to their credit histories, Mr. Radley said.
Cardholders will receive a 1% rebate on their card spending that can be redeemed for savings on their heating bills.
Household estimates that cardholders could save as much as 20% of their average gas bill.
Household and British Gas seek to enlist other partners to let cardholders save on other household essentials.
Martin Rutland, a spokesman for the bank in London, said the name Goldfish was chosen, "to get people's attention."
Moreover, Household wants to establish a new service brand with the name, from which it can offer other financial consumer products. Household and British Gas each have a 50% stake in the project. They set up a company called Goldbrand Development Ltd. to run the card and other products to be sold under the Goldfish name.
PSI International consultant Peter Hall said that the partners were savvy in not using either of their company names to identify the new card, because British Gas has been the subject of negative media coverage regarding customer service and Household is not a big name in the United Kingdom.
The largest credit card issuer, Barclays Bank, has 8.8 million cards. Gemini Consulting estimates that a card issuer needs at least 500,000 cards to be profitable, a feat that Household may not find difficult with access to 19 million homes.
Goldfish, available now, has a 18.9% interest rate and no annual fee. Nearly 70% of other U.K. cardholders pay an annual fee, and average interest rates are between 22% and 23%, Mr. Rutland said.