February 9,2009
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News: Chase Chases New Fees.
Get ready, Chase credit card holders, here it comes. These latest trends appear to be sweeping the credit card industry. All those sweet deals we were offered a few months ago appear to be going sour. Low promotional 0% interest for a year on new credit card accounts are being corralled into a major trap now.
Our nation's largest credit card issuer, JPMorgan Chase, is rolling out notices to hundreds of thousands of us who hold low-interest accounts for $120-a-year worth of monthly fees. That equates to $12 million per thousand card holders. Although the $10 monthly fee strategy has recently been exacted by a few other lenders, this move stands out because of the large number of credit card holders affected and because this group was drawn in by a massive marketing campaign that Chase had launched a while back to attract consumers to save money. That expectation is now being shattered.
If kept to the latest guideline, it may not be as unfair as some fear. It has been indicated that the segment of credit card consumers in target here are only those with very low interest terms who have maintained a large balance for over two years and are not paying down on the balance. In light of the crumbling credit card economy, it may be fair to see some adjustments in extreme cases like this but, many fear that this new trend is just beginning and will grow to a much larger scale in the coming months. For instance, JPMorgan now also controls all those former WaMu clients and will, likely, continue with this policy wherever they can.
It wouldn't surprise anyone if the other credit card giants like Bank of America and Citibank were to follow suit. As far as Chase is concerned, a little perspective is helpful. This latest change will only affect one-half of one percent of its card holders. Still, because they're so large, this number could be as high as 400,000 customers, equating to $48 million per year for Chase for that one fee alone. Chase spokeswoman Stephanie Jacobson, explains that their bank is responsible and careful with customer treatment but, sometimes, it becomes necessary to change card terms because of changing risk, funding costs and market conditions.