August 5, 2009
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News: CC Companies Playing the Fee Game
It seems as though the more consumers try to get ahead, the more difficult it becomes. Some things just don't seem to go away. First the credit card companies began increasing interest rates without justification. Then they started slapping unfair penalties on unsuspecting consumers. The financial industry has been playing the fee game over the past few years which has contributed to the mess that many consumers are in now. As it grows nearer and nearer to the implementation of the new credit card reform bill, lenders have become very creative in developing new schemes to siphon money out of consumers' pockets. Just to mention a few, Fifth Third Bank now charges a $19 fee on any card account that remains inactive within a 12 month period. For purchases made outside the U.S., Discover charges an additional 2%; while Chase will begin charging some Freedom credit card accounts a $30 annual fee.
It doesn't end there. Beware Citigroup credit card customers. If you are late paying your monthly payment, Citigroup will be swiping your reward points and will charge a "reinstatement fee" if you care to cash them in. These fees are just a few examples of how the financial institution intends to counteract the effects of the new law that will inhibit them from making arbitrary interest rate increases to fill their deep pockets. It is no secret that the credit card companies are finding ways to get around the new law and looking to boost earnings in spite of a recession and high unemployment.
Americans have not seen the end of these hidden fees. They can also expect to see fewer credit card offers and less lucrative contracts. For those limited offers consumers do receive, they will notice the offers come with more creative and higher fees. The once nearly extinct annual fee has already made its way back into the picture, and most likely a large percentage of new offers will include the annual fee.