Here are three somewhat weird things that happened in the world of credit cards today.
Citi Has A Strange Offer
I am a big fan of the reward cards that offer a minimum spend to get to a big reward. It seems like a fair deal to me. You give us your business, and we give you a reward. For example, Citi’s American Airlines cards require a $750 in total spending before getting a 30,000 mile reward. The latest offer from CitiBank is a strange twist on that. This article points out that Citi is now offering to lower your interest rates if you spend $750 a month.
I think this is taking it a bit too far. In my world, people paying credit card interest are, by my definition, spending too much. They are inherently in over their heads. Asking them to spend more to lower their interest rate is predatory. On the face of it, most people of low to moderate income will spend at least $750 a month, so you could argue that Citi is just asking you to use their card over others. Even that line of argument reminds me of tobacco companies defending their advertisements as just wanting people to switch brands, even as they placed ads in teen magazines. The other problem is that if other companies start doing this, soon you will have a situation where someone could owe money on multiple cards, and they will have to go further into debt to reduce their credit card payments.
I love reward cards, yet I firmly believe that they are only for people who pay their bill in full every month. I really think a line is crossed when you go from a reward based on a minimum spending amount to a lower interest rate based on a minimum monthly spend. Shame on you CitiCard for implimenting predatory practices, even if they are not banned by CARD!
Better New From Chase
Chase has decided to end the mandatory binding arbitration clause in its cards. This kind of arbitration is inherently unfair. The original idea behind arbitration was that disputes could be resolved more quickly and less expensively in a private setting than in the courts. Mandatory binding arbitration turns this upside down in that you have essentially given away your rights to an impartial judge, and now must submit to a very lopsided forum. According to this article, “A congressional report in July said the National Arbitration Forum, a Minneapolis-based company that handled most debt arbitrations in the U.S., misled consumers and hid ties to collection firms. Companies won almost all the time, according to the American Arbitration Association.:
While this is seen as good news, it is akin to a reading a headline, “Man Stops Beating His Wife”. Obviously it is bad news that this practice ever occurred. Worse, I have have seen no indication yet that other banks are following Chases lead, yet.
The Strangest Credit Card Ever
Finally, here is an odd article about a “credit card” that cannot be used to purchase anything. It’s purpose is to be used as a utensil. Granted, I have used credit cards to try to jimmy a locked door, or even to scrape ice off of a windshield, but I don’t imagine I will ever use one as an eating utensil. The thing cost $12, about the same price as some decent cutlery! I think it is sold for design, artistic, or novelty purposes.
Are you really so short on space that you can’t bring along a regular plastic utensil? I would sooner slurp my soup or eat with my hands, thank you.
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