Instead of waiting around for the CARD act, which restricts the ways they are allowed to squeeze money from customers, some banks are introducing simpler, CARD-compliant credit cards meant to be less confusing to consumers, and maybe make us all hate the credit card industry a little less.
Credit card experts said card issuers are clearly trying to improve their images after months of defending themselves for raising interest rates and cutting credit lines for even their most creditworthy customers. Consumers have been increasingly turning away from credit cards. Revolving credit, mainly credit card debt that consumers do not pay off in full each month, fell $6.1 billion in July, according to the Federal Reserve.
“It’s stiff competition in terms of trying to regain consumer trust,” said Curtis Arnold, founder of CardRatings.com, which compares credit cards, “and trying to regain loyalty among cardholders.”
The Chase Blueprint program applies to existing cards. It allows customers to choose categories of spending to pay off every month, and helps calculate ways to pay off balances more quickly. Meanwhile, the Bank of America Basic card has no overlimit fees, and charges the same interest rate, fourteen percentage points above the prime rate, for all transactions.
It’s a sad commentary on the current state and reputation of the industry that when credit card companies introduce features designed to help and not confuse customers, it’s newsworthy.
Credit Card Firms Offering Simpler Deals Ahead of Law [Washington Post]