Would You Credit It?

1:15 PM -- BT Group plc (NYSE: BT; London: BTA) has launched a number of new services in the past few years -- VOIP and IPTV, for example.

Now, though, the carrier has taken a giant leap outside of its comfort zone by announcing its entry into the personal finance services market.

Yes, if you are one of BT's 15 million or so residential customers you can now run up hideous debts and stare personal bankruptcy in the face using a BT Credit Card, which comes courtesy of BT's behind-the-scenes partner in this venture, MBNA Europe (part of the Bank of America).

But it's not all bad news...

The card comes with "an innovative reward scheme" -- for every £2 ($4) run up on the card each month up to a total of £250 ($500), BT customers get 1 pence knocked off their BT bills! So, spend exactly £250, and your bill will be £1.25 ($2.50) lighter!!

It gets better!!! Spend more than £250 on your BT Credit Card in any month, and you get an extra 1 pence knocked off your bill for each additional £1 ($2) spent!!!!

My calculator tells me that a BT domestic customer would see £8.25 ($16.50) knocked off her bill if she spent £1,000 ($2,000) using a BT Credit Card in one month.

Of course, BT has a limit on how far this can go -- £75 ($150) is the maximum discount anyone can get in any one year.

Gavin Patterson, the managing director of BT Retail's consumer business, is clearly excited at the prospect of offering his customers a chance to spend beyond their means.

“The BT Credit Card will be an obvious choice for millions of BT customers," he is quoted as saying in the carrier's press release.

Will it? I doubt it.

But is Patterson excited enough to use one himself? "He may do," says a noncommital BT spokesman.

And will BT's management team, such as CEO Ben Verwaayen, be bulking up their wallets with BT Credit Cards? "BT believes in free choice, but we would encourage staff to use it. It's the top story today on the BT intranet," notes the spokesman.

What a shame we can't all read it.

It would be churlish of me to mention at this point that punters all over the U.K. have for many years been able to apply for a credit card from Richard Branson's Virgin Group. Yes, that's the same Richard Branson that now has a major stake in BT's biggest rival, cable giant Virgin Media Inc. (Nasdaq: VMED). The Virgin empire also runs a successful airline, Virgin Atlantic, a major rail transport service in the U.K., a holidays business, and many other ventures.

So now we eagerly await BT's entry into the aviation business -- anyone for BT Business Class?

— Ray Le Maistre, Credit Control Editor, Light Reading

mr zippy 12/5/2012 | 3:52:55 PM
re: Would You Credit It?

Watch out.

Larry, Monkey 12/5/2012 | 3:52:54 PM
re: Would You Credit It?

Thank you for the alert, mr zippy. He now sleeps with the phishes.

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