New fees keep getting reinvented by card issuers
There seems to be a continuous game between the credit card issuers and the Federal Reserve people. Recently in October, the Federal Reserve had to issue a lot of clarifications as far as the regulations on credit card fee were concerned. This was following concerns about the fact that the credit card issuers have managed to find a way around various rules implemented under the Credit Card Accountability Responsibility and Disclosure Act of 2009. A lot of these rules were to protect the credit card customers from being exploited by the banks who used to make billions of dollars every year in fees and various other charges which were levied on unsuspecting credit card customers. Many of the different fees levied were sneaky, and outright deceptive.
The legislations and credit card reforms were exactly passed to stop these practices by the banks. That is one of the reasons why credit card issuers can no longer make a surprise rate hike without warning the credit card customers. However, for many of the credit card issuers, those fees were a major part of the cash revenues. It was obvious that card issuers would try all sort of ways to circumvent these rules and find new ways to make up for those lost revenues. However, recent surveys have shown that since the reforms for credit cards were passed a lot of nuisance fees has disappeared. Issuers are still making money though on the new cards that they are issuing. This is by conjuring new and more creative ways to get money out of the customers.
A lot of these new types of fees fall under 3 categories. A lot of credit card customers have been warned repeatedly to guard against these new types of credit card fees. The credit card insurance turns out to be a good example. It claims to pay your bills in case you lose your financial security and have fallen into hard times. This credit card seems to be growing in popularity. However, it is not as good as it really seems to be. There are some sneaky credit card issuers who are automatically getting customers enrolled for these programs when they get the card. Secondly customers are facing higher minimum payment requirements. This means that if the customer misses it, they have to pay higher late payment charges and face higher interest rates. There is an increasing number of prepaid cards from card issuers as well which levy a lot of fees on the consumers.
Latest Credit Card Issuers News
Citi has officially launched its new travel platform with the assistance of Booking.com, which Citi cardholders can use for earning and redeeming Citi ThankYou points. Citi Travel with Booking.com will replace the existing City Thank You Travel Center and will offer access to over 1.4 million hotel and resort options, as well as competitive pricing […]
An alliance between American Express and i2c is now focused on offering payment products in the American Express network through fintech companies. Amex announced its collaboration with payment and banking technology company i2c in April this year. The two partnered to create a platform that allows fintechs and financial institutions to launch cards more quickly […]
Continuing to live in the present reality and the ongoing COVID-19 pandemic, global giants of the financial and credit sector introduce new bonuses for the convenience of their customers. Mastercard, in turn, has announced new partnerships with DoorDash and HelloFresh offering new food and grocery delivery perks to Mastercard World and World Elite cardholders. According […]
Walgreens has recently announced its plans to enter the consumer financial services market. To be precise, the second-largest pharmacy store chain in the United States is going to start issuing credit cards and prepaid debit cards under its brand. The main reason for this expansion of the scope of activity is the losses incurred by […]
Very soon Apple fans will get an opportunity to purchase such devices as Mac, iPad, AirPods, the Apple Pencil, and more at a 0% interest payment plan. This weekend, Bloomberg shared the information that Apple Inc. was about to offer a 0% financial option on its Apple Card credit card by Goldman Sachs®. The new […]