For too many years banks have abused the rights of their credit card customers. For example, last year I received a call from a local bank stating that due to my credit status I was selected for a free Mastercard credit card with a credit limit of $500.00. Since I didn’t have a credit card at that moment, I accepted the offer and went to the bank to pick up my free credit card.
Shortly after I retired, I solicited an increase on the credit limit to $1,000.00. That would be enough in case of an emergency, like a car accident. My request was accepted, but oops!, on the next bank statement there was a charge of $40.00 for the cost of the card for a whole year. I thought the card was free as a special marketing promotion. I was wrong.
About fifteen days ago, I received a note in the mail from my bank advising that starting in May, there were be a monthly fee of $3.50 for Credit Card Fraud Insurance up to $10,000.00. I never requested this insurance. They courteously replied it was mandatory and that it was in my advantage to protect myself against fraud. Now my credit card is costing me $82.00 a year, and I thought it was a free gift for being a good customer. I was wrong again.
I thought of returning the card, but after venting for a while, came to the conclusion that having the card for an emergency was still valid even at a yearly cost of $82.00. I hope this story ends here and no more charges are in the pipeline.
In Panama, banks can get away with murder. They pay you 1.5 percent interest for your savings account, but charge you 7.99 percent for a personal loan and up to 18 percent for a credit card loan. The spread is preposterous. Who’s looking after the customer’s pockets. Nobody, that’s who!
In the U.S. things are beginning to change under Barack Obama’s new Administration. Seizing on the growing unpopularity of credit card companies, President Obama recently threw his support behind legislation moving swiftly through Congress that would restrict the ability of banks to impose higher fees and interest rates on consumers.
In a White House meeting with credit card industry executives, Mr. Obama sought to jawbone the companies into accepting changes—some voluntarily, some through legislation—that could cut heavily into profits at a financially difficult time. Credit cards representatives which met with the President included:
- American Express
- Bank of America
Today I found out reading the news, that Legislation to rein in credit card practices and eliminate sudden rate hikes and late fees that have entangled millions of American consumers is getting closer to becoming law, bolstered by presidential pressure and the backdrop of economic calamity. Among measures being taken to protect the credit card consumers are:
- Banning unfair rate increases, fees and penalties.
- Plain English language contracts. Mr. Obama called on the companies to produce statements that are clearly written and do not have any confusing terms and conditions. He also proposed that every company issue a “plain-vanilla, easy-to-understand, simplest-terms possible credit card” to make it easier for the average consumer.
- Greater accountability on behalf of the credit card companies.
- Banning minor as clients.
“Most of the banks realize that some of what they’ve done before—the processes being followed—don’t really look very good in the light of day,” said Senator Tom Carper from Delaware, whose state is home base for a large number of credit card firms.
I hope our next president in Panama will look into this matter, and adopt immediate corrective measures It’s getting out of hand. Greed has taken over most bank’s predatory practices. They will have to be forced to put their house is order and clean up their acts. Wishful thinking? Good Day.
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