Barclaycard, the credit card division of UK bank Barclays, has announced that it is to remove itself from the Nectar loyalty scheme because its customers would prefer alternative incentives.

The leading UK card issuer, which last week finalized a deal to launch its card in Scandinavia, said that its customers had indicated that they would prefer other incentive programs over the points awarding loyalty scheme.

Barclaycard said that in response to customer wishes it would withdraw from the Nectar scheme on 31 August and that from the following day it would offer in house insurance products as alternative incentives.

The company said that holidays booked through the Barclaycard Travel Service and paid for using a Barclaycard would benefit from complementary travel insurance. Barclaycard added that the travel insurance would be available for up to six people, and would include winter sports coverage.

We are constantly reviewing and developing the services and offers we provide to customers, based on their feedback, explained Mark Gonnella, consumer affairs director for Barclaycard. The vast majority are now saying to us very clearly that they value the back-up support we provide, particularly when it comes to travel. We have decided to make this change as a result.

The potential negative impact of Barclaycard’s decision on Nectar is likely to be partly mitigated by the signing of a new deal with American Express. According to Nectar has completed a deal with the US card provider which will award twice as many points as the Barclaycard scheme.