Credit card companies prevent economy revival by rising fees

While the U.S. government is seeking to enhance consumer spending and make people to again borrow credits from financial institutions credit card companies are making cardholders lives more and more cramped which finally results in some cases in account termination initiated by bank consumers.

A large number of cardholders complain about the credit card companies’ unjust raising the interest rates while they think they have done everything right. While many of consumers heard about that the companies would raise the rates and fess they never thought it would happen to them.

One man, a customer of Capital One, notes: “If I was a business man, I would love to have me as a customer.” He says that he was never late on payments while paying more than the required minimum. Mike Cherry from Consumer Credit Counseling Service notes that the credit card companies are revising the credit worthiness of all their customers which means that increased rates will be applied to ALL, even to the most conscientious of them.

“Basically, they're moving it from 9.9% to 17.9%,” says the man.

In this regard a spokesperson for Capital One explained that the company is raising the rates ‘to reflect the current risk environment. The decision was based on a number of factors, including the cardholder's current interest rate and the length of time they've had that rate and the account’

Pointing to the fact that Capital One was among those companies granted with the government bailout funds the man notes: “For good paying customers I don't think it should be legal for them to do that.”

Mike Cherry concludes that this may result in that customers just would close their accounts and ‘go back to using cash and what they can afford to buy’. But the problem is that many customers do not pay attention to the notifications of the credit card companies about their intention to increase the rates and fees treating their mail as some advertisement trash.

The man expressed his concern: “One of the problems that people are going to have is people are going to get this letter and say oh well, it's just more junk mail and they're not going to read it.”