Killer card fees affect everyone
Credit card customers often realize the hard way that no one is spared from the killer card fees. Until a year ago, the fees or charges levied on credit cards for various reasons contributed to a major part of the revenues of these credit card companies. It was then that the Credit CARD Act was passed resulting in massive loss of revenue for the credit card issuers and also taking the pinch out of the amount that customers were charged as penalty under various circumstances.
There are strict rules now that put a tab on how much and in what cases the banks can increase the rate of interest on an existing credit card customer. Apart from that credit card issuers are also expected to provide at least 45 days notice before they can make any major changes to the credit card terms. Another welcome change is that the inactivity fees which in some cases almost seemed cruel has now been almost completely gotten rid of. There is also a cap of 25 dollars applied on the late payment fees that banks can charge on the customers. Most importantly, if banks have to charge you with overdraft fee, they will have to first get the credit card customers` approval to cover and bill you when you go over the limit. However, the credit card fees problem is not completely over.
There is another stream of fee revenue that is trickling through the holes in the filter provided by the new banking laws. There are at least 3 common charges that would punch the customers and their finances. Bank service fee is the first amongst them. There was a time when to attract deposits from customers, they were offered free checking, free money, free foreign ATM withdrawals, free corporate branded merchandise and various other things. Now these offers are extended only to the best customers with the highest credit card rating.
Credit card companies have now introduced warnings for a customer to allow fee-free banking. If a customer falls short of these criteria there would be charges on the services varying between 5 – 30 dollars every month. The annual fee is another charge that credit card customers have to be especially careful of. Today if customers get the benefits or rewards from a credit card including points, miles or cash back, they have to keep an eye out for the exorbitant annual fee. The annual fee can exceed all the savings you make from rewards.