Credit Card Companies Are Really Greedy and Stupid

OK, we’ve all known that credit card companies are greedy. Perhaps that isn’t even a fair description, I’ll admit. Financial institutions are in business to make money and so they will do things in order ensure profitability. Shareholders expect that.

Still, the logic of these companies escapes me a little. The other day, I logged into my account to pay my credit card bill when I was presented with this message that said “Late Payment Warning”. It scared me, because I thought that perhaps I had missed my payment due date. I clicked on the link and it said that if I failed to make my payment by the due date that I would be charged $40 and my account would be subject to a Penalty APR of 29.99%.

Wow, those are strong threats for a person who has never been late making a payment. So, I called the credit card company and told them I wanted to cancel my credit card. They asked why and I told them. They then proceeded to tell me that that message is on every person’s account due to new federal laws. I replied explaining to them that there were no federal laws that required them to charge $40 or increase my interest rate to some astronomical rate. Further, any such notices to that effect could be done more tactfully. This went on for at least 10 or 15 minutes and between two different people who were begging me not to cancel my credit card.

Perhaps this is a petty reason to cancel a credit card, but we all know that it takes loss of customers for a company to change and I don’t mind being the first person to “speak with his wallet.”

What followed was absolutely hilarious. Apparently while my credit card company was on the phone with me pleading to keep my business, the same company was mailing a letter to my step-daughter to inform her that if she didn’t spend more money on her credit card each year, she would have to pay a $60 annual fee. In fact, they planned to charge her $60 in a month or two and would then return that to her after a year if she charged at least $2,400. Let’s review: they will charge her $60, but then credit her account in one year, at which time they will charge her $60 again? They did say this was an annual fee.

Clearly, she has no desire to pay $60/year and will call (if she hasn’t already) to cancel her credit card. Even if she would charge $2,400 over the next year, she does not want to give the credit card company a $60 loan or whatever you call this charge/refund/charge/refund every year.

As far as I can tell, the credit card company is greedy for not wanting to deal with low-volume customers and wasting time arguing with higher-volume customers, and stupid for throwing away current and potential business from responsible people like my step-daughter.