Credit card companies offer new incentives

HOUSTON We talked to a lot of people who told us they have either cut back or stopped using credit cards completely. Credit card companies see it too and now they are unveiling new tools designed to make plastic popular again.

"Don't want to get behind on bills and money is stretched so thin right now as it is," said Josh Rean.

When it comes to paying with plastic, the Rean family is just saying "No."

"You just can't afford the interest rates on it and it's better to use cash and you don't want to get backed up on all those bills and everything," said Angela Rean.

The cut in credit card use may be behind the move by the credit card companies to make their products more attractive. Chase is allowing consumers to buy everyday goods like groceries or gas without accumulating interest as long as they pay for the goods in full each month. Wells Fargo and Discover Card are offering debt management tools.

"They should be applauded for putting things in place to help people who are using credit cards for everyday expenses and having a hard time paying the balances in full," said Tanisha Warner of the Consumer Credit Counseling Service.

Warner sees plenty of people who have gotten into trouble using credit cards. She says it's not surprising the credit card companies are rolling out consumer friendly options now.

"Unemployment is up right now and that has a direct impact on delinquencies, so if you consider that more people are unemployed and that more and more people are not going to be able to afford their payments, that messes with their profits," said Warner.

Warner says because of rising unemployment and a decline in household wealth, consumers would be wise to keep credit card usage to a minimum right now no matter how attractive they become.

"If you use it all the time, at the end of the month you are facing a big balance and it is even more tempting to pay less than the balance if you can and then you end up paying interest on things you'd normally pay cash for," said Warner.

The Chase program is available to 20 million of its credit card customers. You have to select which goods will be included in the interest grace period. There is an online tool to help you set it up.

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