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"Good credit card payers being penalised by credit card firms"

By admin | June 29th, 2008 | Credit Cards

Many consumers that use their credit cards regularly, repay the balance in a timely and responsible manner, and are not knee deep in debt, are being penalised by credit card companies according to a recent report. The report suggests that credit card companies are penalising good paying customers because they are not generating enough profit due to lack of charges and interest accrued by these customers. Over recent months many credit card customers have been penalised in a number of ways.

A recent survey involved polling around three thousand adult credit card users, and of these 8% had been penalised by their credit card company, which equates to around 2.5 million people in total. In over 70% of these cases the credit card firm was not able to justify the action taken to penalise the customer. Around half of the customers that were affected by these actions said that they had always made timely and responsible repayments and that they used their credit cards on a regular basis.

One industry official stated: ‘Essentially, a quarter of people were told it was because they were high risk or had a poor credit rating. Now that doesn’t add up because we found that 71% were good customers. They were paying their bills and using their cards regularly. There’s always an element of profitability in these cases, which is clear here. Of all the millions of people affected, only a relatively small number deserved to be treated like this. The only real explanation for this is that companies are chasing profits.’

Amongst the actions that have been taken by some credit card firms to penalise consumers are adding annual fees, increasing fees and charges, raising the interest rate suddenly, cutting spending limits suddenly, and even withdrawing credit card facilities from some customers altogether.

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Tags: Credit Cards

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