Credit Card Industry Aims to Profit From Sterling Payers? Pay cash, then.
Credit Card Industry Aims to Profit From Sterling Payers
Now Congress is moving to limit the penalties on riskier borrowers, who have become a prime source of billions of dollars in fee revenue for the industry. And to make up for lost income, the card companies are going after those people with sterling credit.Banks are expected to look at reviving annual fees, curtailing cash-back and other rewards programs and charging interest immediately on a purchase instead of allowing a grace period of weeks, according to bank officials and trade groups.
The expectation is, according to a different business,” said Edward L. Yingling, chief executive of the American Bankers Association, that,
“Those that manage their credit well will in some degree subsidize those that have credit problems.”
That’s the equivalent of “soaking the rich” on taxes. Soak the rich, lose the rich.
I’m one of the people who pay their entire credit card balance in full every month.
Here’s what I’ll do if/when credit cards charge interest immediately:
Cash. What a concept.
The credit card company that will not charge interest immediately will have a huge opportunity; they will attract the clientele with the best credit. There’s money to be made in that.
Tags: bailout, banks, Fausta's blog
May 19th, 2009 at 8:53 am
There’s the debit card alternative. If the merchant allows it to be used as a PIN debit card instead of a credit card, there’s a little bit of a benefit for them as well; the fees they’re charged aren’t as high.
May 19th, 2009 at 12:37 pm
I’m with ya on this Fausta. Pay cash or debit. I dumped my credit cards after I bit the bullet and paid ‘em off. Too much enticement to overspend. And I’ve been better off.
May 19th, 2009 at 1:04 pm
It’s at times like these that I begin to understand how the moonbat Left must’ve felt in 2002-2003, as we were about to liberate Iraq: I’m watching the government do everything I know it shouldn’t do, and it’s frustrating and frightening.
Only, unlike the moonbats, my fears are grounded in reality.
May 19th, 2009 at 3:53 pm
Those that manage their credit well will in some degree subsidize those that have credit problems.
Mr. Yingling is a ding-a-ling. If good paying customers are charged annual fees or other charges, it is the bank, not the customer struggling to pay his bill, who is at fault. The bank sets the fees.
Those who carry balances or have trouble making the minimum payment are the ones now subsidizing everyone else, including those who pay off the balance every month and those who don’t pay at all. They are the ones paying 24% interest and $39 late fees for being one day late with a payment. This guy is full of it.
May 19th, 2009 at 11:07 pm
There is also currently the option of cashing one of the checks that regularly come from the card companies. Granted there is a cash advance fee but most of the ones I get are interest free for six to nine months.
May 20th, 2009 at 6:02 pm
[...] quite rightly says the only viable alternative is to "pay cash". Yup, cash is still [...]
May 21st, 2009 at 11:13 am
[...] fact, I did it yesterday when I emerged from my cave to eat some soup. I used a post by Fausta to engage Nadz in a dicussion of the merits of using cash instead of plastic. He already replied [...]