DJs feels credit (card) crunch

NATIONAL: David Jones has been forced to defend its recently launched American Express branded credit card after concerns were expressed it could diminish its "prestigious reputation". According to a report by the Australian Associated Press, the issue was raised repeatedly at the department store's annual meeting on Friday with one shareholder drawing cheers for describing the credit card provider as "low grade".

Other concerns included the card's $99 annual membership fee, surcharges and the level of mail involved to sign up to the service. However David Jones chairman Robert Savage defended the new card and said it would deliver "considerable revenues and profit streams" in a tough economic climate.

CEO Mark McInnes said prior to the launch of its new co-branded credit card, American Express was the second most used card in its stores. An agreement with the provider had also been arranged to reduce the number of surcharges applied to the new card.

He said the decision to transfer its receivables to American Express, which became responsible for credit policy, had helped to maximise the company's financial health by freeing up $35 to $40 million in cash.