If you have a Citigroup-issued credit card and you haven’t had a rate increase over the last two years, expect to be notified of a 2-3% rate increase on your November statement. Congratulations! You’re going to help Citigroup offset its losses in the global credit card division, whether you were directly part of those losses or not. As the New York Times points out, by doing this Citigroup is breaking the promise they made to Congress in 2007 that they would not arbitrarily raise rates on accounts—which may be why they’re offering a fairly lenient opt-out policy.
From the New York Times:
Citigroup cardholders will then have until the end of January to turn down the higher interest rates. If they decline the rate increase, they will pay down the balances on their accounts under the old pricing terms and will be able to continue to make charges until their credit cards expire.
After that, however, customers will have to reapply for a card or find a different lender.
If you receive your statement online, a separate rate increase letter will be mailed to you. LowCards.com points out that you should pay close attention to your mail because such notices are easy to overlook:
They often come in nondescript white envelopes that are easy to miss and toss before reading. However, if you don’t respond, you are stuck with the rate increase.
If you decline the offer, send a letter to your issuer by certified mail.
Keep a copy of the letter for your records.
“Despite Pledge, Citigroup to Raise Credit Card Rates, Blaming ‘Difficult’ Environment” [New York Times]
(Photo: Spencer E Holtaway)