Credit Card Information You Need to Know

“Like most consumers, I had always assumed that banks and customers are united in wanting to curtail bank fraud.”

So begins an August 23rd article in the Huffington Post. I’ve been saying for years that banks have a revenue stream in fraud. I made the statement very publicly as Merchant911′s Director on the CBS Evening News several years ago in reference to chargeback fees to merchants. Naturally, an American Banker’s Association spokesperson denied it – instead saying the fees were “to encourage the merchant to be more careful.” I’m not sure I understand the difference there but that’s what they said.

At any rate, if you think the bank is your friend and wants to stop fraud, I suggest that you read the Huffington Post article above. You should probably put aside any preconceived ideas first. It might keep you from being quite so shocked.

According to a recent article in Money Talk News, credit card issuers are patting themselves on the back after a new report shows they’ve gotten rid of many “unfair” or “deceptive” practices consumers complained about.

My recent credit card statements have announced how the bank is now “allowing” me to opt in to “overdraft protection.” They don’t mention that it’s now the law, in the hope that I’ll think they are doing it to be nice. They’re also telling me that they won’t raise my interest rates on existing balances. Same deal. It’s now the law, not their great customer satisfaction goal.

The fact is that the CARD Act forced the banks to make these changes. To add to that, the banks are finding other ways to tack on fees to make up for the lost revenue. Watch for these:

We talked about some of the things they pulled before the law went into effect. Now they need to take a different road. Never forget that banks are in business to make money–lots of money. Have you ever seen a less than perfect bank building? Fees that the new federal laws won’t allow will be replaced by others. You can count on it.