[Fredslist] An alert to credit card users

[David Abeshouse]

Gotham Colleagues: 

 

I want to alert you to a very strange (indeed counterintuitive) business
policy of at least one credit card company.  

 

As I was paying my credit card bill yesterday, I noticed a little "finance
charge" on my credit card statement for the period ending 3/9.  I saw that
they'd posted my previous month's payment as of 2/20, well before the due
date, so I was puzzled, and rather than ignore it (which was my first
impulse), I called customer service to ask why I'd incurred the finance
charge. 

 

The phone rep confirmed that I've had my CitiCard for over 25 years, and
have an excellent payment history, paying the full balance on time every
month, up till this January, when my payment was "late."  I asked by how
much it was late and she said by one day, which caused the balance to
"revolve," and me to incur a late fee (which I hadn't noticed on my Feb.
statement) and the finance charge on my March statement (the one I paid
yesterday).  She cheerily volunteered the following info: Citi Cards had
shortened my statement cycle (the period from when they print my bill
through the due date for payment), because I was such a good customer.
Baffled, I asked her to explain this, as it was counterintuitive to me.


 

She "explained" that this benefits me because it allows me to use my card
more effectively.  I disagreed, and asked her what she meant by that and she
couldn't explain it any more specifically.  I told her that the only way it
could benefit someone was if they were to use their entire credit line each
month (and I don't put $20K per month on this card - far from it), as faster
payment would free up the line sooner.  However, for the vast majority of us
who don't use our entire line each month, this policy actually was punitive,
because shortening my statement cycle to substantially less than the 25 days
I'd had previously requires me to pay the bill pretty much as soon as it
arrives (artificially making it a priority) and renders me more susceptible
to inadvertently missing the payment deadline by a day or so if the mail is
slow.  

 

So, I clarified with her that the reason for this whole scenario of late fee
and finance charge was imposed on me because I'm a good customer who always
pays his bill on time and in full, so they shortened my statement cycle,
rendering me susceptible to extra charges if my check - mailed a week in
advance of the due date (I don't bank online yet, for a # of reasons) -
arrives a day late due to US Postal Service delays.  She agreed with my
summary.  I told her that I needed to have my 25-day statement cycle
restored or I'd be an ex-Citi Card customer immediately.  

 

To her credit, she apologized, went to check on it, and said that she could
remove the charges and restore my 25-day statement cycle.  I also asked her
to submit a customer complaint about the policy, in hopes that others
wouldn't be subjected to this wrongheaded practice (wish me luck!!).  

 

The moral of the story is: If you're a good credit card customer, check your
statement cycle, and if it's not close to 25 days or thereabouts, call to
ask that the longest possible cycle be restored to your account, to decrease
the possibility of incurring a late fee or financing charge.  In these
times, every cost saving helps.  

 

Best regards, 

 

David 

 

 

David J. Abeshouse  

Law Office of David Abeshouse  

50 Charles Lindbergh Blvd., Suite 400  

Uniondale, New York  11553  

Ph: 516-229-2360   Fax: 516-229-2361  

Alternative Dispute Resolution  

Arbitrator/Mediator  

David at BizLawNY.com  

http://www.BizLawNY.com  

 

See my LinkedIn profile:   

 <http://tinyurl.com/455eqj> http://tinyurl.com/455eqj  

See my Avvo profile:  

 <http://tinyurl.com/4u34gg> http://tinyurl.com/4u34gg  

 

 

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