Tuesday, May 19, 2009

Shylock's pound of flesh (new and improved ideas)

From the annals of usury, news that credit card predators are looking to cardholders who make their payments on time as a prime source of revenue going forward.

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.

Fun credit card company facts and a gentle reminder on how unfettered capitalism basically screws the consumer: 

  • The amount of money generated by penalty fees like late charges and exceeding credit limits should top $20 billion this year.
  • 70 percent of card issuers’ revenue came from interest charges, and the portion from penalty rates appeared to be growing

'Suburb Train', 1988. From the works of Ukrainian-born photographer Boris Savelev. More here.

1 comment:

Ashok said...

Good luck to them trying to screw those with sterling credit. If you were responsible enough to have sterling credit, you will be smart enough to stay away from the predatory cards.