Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I had heard about that. A friend at work just got hit with a $75 "annual fee" on his CC.
I called up my CU and asked them if they were planning anything like that and they said no.
I pay in full each month. I'd leave in a heartbeat if they started doing that.
Contrary to popular belief Banks are not charities. People that charge a couple hundred a month and pay off their balance each month generate no profit. A credit card is a product, if you just charge on the card here and there and always pay it off you are going to need to start paying for the product. Seems far enough.
Contrary to popular belief Banks are not charities. People that charge a couple hundred a month and pay off their balance each month generate no profit. A credit card is a product, if you just charge on the card here and there and always pay it off you are going to need to start paying for the product. Seems far enough.
This is not true. Every time you make a purchase on the card, the credit card company charges a fee to the merchant. So even if you pay off the balance in full each month, the credit card company still makes money.
This is not true. Every time you make a purchase on the card, the credit card company charges a fee to the merchant. So even if you pay off the balance in full each month, the credit card company still makes money.
So to demonstrate I'm wrong, you yap about revenue without taking into consideration the costs? Yes, credit card companies get merchant fees and perhaps what you said would make sense if the following things were free:
- Networking
- The development and maintenance of a banking system
- Cost to store relevant data
- Cost to provide consumer predictions
- Cost to mail statements each month
- Costs associated with customer service
- The cost to process a payment
and so on. But they are not free. If the card is a rewards card then credit card company is getting around .8%, if you are charging an average of $200/month that is a whole $19.2/year in revenue. If its not a rewards card then they get around 1.6%, for a total of $38.4. Just mailing statements and processing payments is likely to cost the bank around $20~$25/year, not to mention all the other costs.
So, as I said. A costumer that only on average charges $200/month and pays off their balance each month is not in general profitable for a bank. These are the people that are going to be targeted with annual fees. On the other hand people that run a balance, or have charges in the $400+/month range are unlikely to be targeted.
Now, some banks/credit unions may be willing to eat the costs to keep your business on other fronts.
Location: TX Hill Country-Helotes, Pipe Creek/Lake Hills & San Antonio, TX
844 posts, read 1,627,368 times
Reputation: 1371
Ludicrous!
This is so true. It happen to me! I also heard about this a couple of months ago on CNBC, and I've even read this in several finance news articles. They will always try to find a way to make money!!! This is ludicrous!!!
they want you to keep using the credit cards. closing them is something they dont like.
credit should tighten during a recession and recovery it did not.
This is so true. It happen to me! I also heard about this a couple of months ago on CNBC, and I've even read this in several finance news articles. They will always try to find a way to make money!!! This is ludicrous!!!
If you want to blame someone, blame Obama for it. The bank has to make money to stay in business, and since they are going to lose a lot of money with the new regulations, they have to make up for it somewhere else.
If you want to blame someone, blame Obama for it. The bank has to make money to stay in business, and since they are going to lose a lot of money with the new regulations, they have to make up for it somewhere else.
So instead of blaming the thousands of people that forfeit or declare bankruptcy, you blame Obama.
The new regulations are a good thing and is about time!
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Ludicrous!
