New credit card fees on the horizon: report
A move by the United States Senate ,400%20per%20year.%20Fees%20for%20printed%20statements.%20Some%20issuers%20are%20adding%20a%20href="%20monthly%20processing%20fee%20should%20you%20request%20a%20printed%20credit%20card%20statement%20each%20month.%20%20Decreasing%20rewards%20on%20many%20cards.%20Issuers%20will%20cut%20costs%20by%20reducing%20rewards%20for%20some%20cardholders,%20especially%20those%20who%20don%E2%80%99t%20an%20annual%20fee%20and%20pay%20off%20their%20balance%20each%20month,%20Hardekopf%20says.%20%20The%20reduced%20rewards%20could%20come%20in%20several%20different%20forms,%20including%20a%20cutback%20in%20the%20payouts%20of%20cash%20back%20cards;%20higher%20tiers%20to%20receive%20the%20same%20level%20of%20rewards;%20or%20more%20miles%20or%20points%20needed%20for%20that%20currently%20existing%20perks./">to rein in credit card rate increases and excessive fees has U.S. card issuers scrambling to replace all that lost revenue.
As a result, the cost of credit cards will likely increase despite the major provisions of the CARD Act scheduled to go into effect on February 22, says Bill Hardekopf, author of The Credit Card Guidebook.
Even cardholders who pay their balance in full every month may see the end of 'free' credit card loans as we know them, he predicts.
More cards with annual fees. Both Bank of America and Chase have already made the first moves to test annual fees on a small percentage of cardholders or offer cards with annual fees that build customer loyalty.
Fixed rate cards switching to variable rates. Last year, issuers switched many fixed rate cards to variable rates, making rate increases for everyone almost inevitable as the economy recovers and interest rates in general rise.
New inactivity fees. Fifth Third Bancorp recently added a $19 inactivity fee for cards that stay unused for a twelve month period. Citi, as well, informed some cardholders that they will be charged an annual fee of $30 to $90 unless they spend at least $2,400 per year.
Fees for printed statements. Some issuers are adding a $1 monthly processing fee should you request a printed credit card statement each month.
Decreasing rewards. Issuers will cut costs by reducing rewards for some cardholders, especially those who don’t face an annual fee and pay off their balance each month, Hardekopf says.
The reduced rewards could come in several different forms, including a cutback in the payouts of cash back cards; higher tiers to receive the same level of rewards; or more miles or points needed for to obtain currently existing perks.
Have you received any bad news like this from your credit card company?
Posted by: Reg | Jan 16, 2022 12:22:33 PM
I will lead by examlpe
Monday I will cancel one of three Visa
and one of two Master Card!
Now the ball is in your court.
Posted by: Lisa | Jan 17, 2022 9:24:53 AM
No, I haven't received any bad news like this from my credit card company...and if I did...I just change companies. Remember, companies want your business...if they do too many crazy things and lose too many customers, this is not good for them.
Relax!
Posted by: Mike | Jan 17, 2022 5:01:58 PM
I know many people with multiple cards, and don't understand them. I have one with a reasonably hight limit for emergencies, and one with a low limit that I use on the Internet. I can't see any reason for more. I also pay my bill off each month so don't pay the exorbitant rates. I get cashback, which covers the small annual fee (easily). They make nothing off me directly, but the amount they get as fees from the merchants is significant.
They would be fools to charge us more and lose our business, since they make way more of their profit from the merchants than from me. Let them know you understand the basics of this business, and keep their hands out of the consumer's pocket, as the ad said :)
And either way, they will run their business to generate whatever profit they can, and charge the merchants more as one poster said, to make that happen. I just won't add any extra
Posted by: Tom | Jan 17, 2022 5:27:31 PM
Does anyone know what percentage card companies charge the merchants?
Posted by: RP | Jan 17, 2022 6:24:03 PM
Merchants pay two to four per cent of the sale price in various transaction fees whenever they accept a credit card for payment.
Posted by: tom | Jan 17, 2022 7:36:08 PM
If the credit card companies charged the card holder zero % interest, they would still be making 24 to 48% from the merchants when we use our cards for purchases. If you purchased something each month for $100 and paid it off in total when you got the bill, you wouldn't pay any interest, but the cards would still make 24 to 48% from the merchants. The bank or card companies are never at risk for more than $100 but show a revenue of 24 to 48 % on $100. Not bad getting a percentage of every sale made.
Posted by: rob | Jan 17, 2022 8:24:44 PM
the idea of one person, each cutting up one card is right on
Posted by: Pam | Jan 18, 2022 12:15:23 AM
My credit card companies pissed me off so i chopped up my cards and put them in credit counselling. I wasn't behind on any payments but because I carried a balance they raised my interest rate.Now they don't get any interest at all, they had to wait for three months to get a payment because it took that long to set up my repayment plan and they get lower payments than what I was making myself. Sure, it might screw up my credit for a couple years but I own my home and vehicle so don't really have any use for credit at the moment anyway. In three years, I will betotally debt free and all I am paying is the principle, just like i had paid cash. Screw them. They tried to gouge me so I stuck it to them. I will never have a credit card again unless it is a prepaid one.
Posted by: Lisa | Jan 18, 2022 8:16:44 AM
Well, I agree with much of the anger towards credit card companies.
However, I recently found out that your credit is only affected for 6 years...that's if you go bankrupt. I now wish that your credit was affected for 15 years. THAT would make people really THINK before letting their credit go to pot.
When you get mad and let YOUR credit go...the companies jump at the rest of us too. Similar to the whole "airport" situations, recently. Maybe you just don't care about your "fellow man"...which is an awful attitude...but try NOT to let your emotions get the better of you and try to watch your credit...despite what has been done to you.
(Man, I can imagine the backlash now.) ;) Take care folks.
Posted by: Kim | Jan 19, 2022 2:43:59 AM
I remember all this started with the bank machines 20 years ago and went from there. All these things like online banking, credit cards, interac have been touted as being "convenient for the consumer". Meanwhile, more and more tellers lose their jobs, we get charged more fee's for every transaction plus what your bank account fee is, credit co's charge the retailer at least 6% and they charge us interest, yearly fees, overlimit fee's(used to just decline transaction if u were at ur limit). I agree totally with many comments! I plan on going back to using cash.We have alot more control of the system that way and our own debt. If more people did this, the reversal would happen..create jobs, less fees, and the fat cats at the top wouldn't be making huge sums off us like they are now. It'd kill them to hire more tellers again and have to pay wages! Sometimes technology is to all of our disadvantage, not our" convenience".