Open Thread: Credit Card Companies

UPDATE: Congress Passes Landmark Credit Card Reform

There is much debate in the media today and in government circles about the bandit-like practices of many credit card companies. Arianna Huffington has penned a sharp and damning commentary trashing credit card firms. In the process, she has unearthed every bad name for criminally-minder moneylenders (i.e., usurers) used throughout history. Some of my favorites are:

In The Divine Comedy Dante assigned usurers to the seventh circle of hell.

Deuteronomy 23:19 says, "thou shalt not lend upon usury to thy brother."

Ezekiel 18:10 compares a usurer to someone who "is a thief, a murderer...defiles the wife of his neighbor, oppresses the poor and needy, commits robbery, does not give back a pledge, raises his eyes to idols, does abominable things."

The Koran is equally unequivocal: "God condemns usury." And it goes on to say that "those who charge usury are in the same position as those controlled by the devil's influence."

Yes, that is just about how most people feel about credit card companies, some of which are charging people up to 30% interest at a time when more and more Americans are using these loan devices to buy basic staples to stay alive. Maybe the seventh circle of hell isn't deep enough.

Leave your thoughts and experiences below about dealing with credit card companies. Is the government moving fast enough to curb their unfair fees and crippling interest rates?

12 Credit Card Ch-Ch-Changes

12 Credit Card Ch-Ch-Changes
Credit card interest rates have generally increased for all major card issuers and even doubling or tripling for consumers who pay their bills on time. Credit cards interest rates are typically pegged to the prime rate, which has fallen from 5.25 percent a year ago to 3.25 percent now. But the national average rate for credit cards has actually risen over that period from 11.3 percent to 12.1 percent.

In January, Chase began charging $10 a month to 400,000 customers who have large balances but little account activity.

Balance transfer fees used to be capped, so that no matter how much you transferred, you paid no more than $50 or $75. The caps have been dropped. The standard balance transfer fee has risen to 3 percent, and Bank of America and Discover recently increased that fee to 4 percent on certain offers.

EyeWire

Cash advance fees had been 3 percent, but Bank of America now has 5 percent cash advance fees for advances obtained through ATMs and at banks and 4 percent on direct deposit and check cash advances.

Analysts predict issuers will reinstate annual fees as standard features on accounts.

Cassandra Hubbart, AOL

Chase increased the minimum payment from 2 percent to 5 percent for cardholders with large balances.

jupiterimages

Many card issuers are slashing credit limits. Industry analyst Meredith Whitney predicts banks will cut credit card lines by a cumulative $2 trillion this year and $2.7 trillion by the end of 2010.

Corbis

American Express has taken the most heat over slashing credit limits. Nearly half of its portfolio underwent a major overhaul that included cutting limits by a half or more. Other issuers have cut limits too, sometimes to amounts lower than the balances owed -- triggering over-the-limit fees on a few accounts.

American Express

Citi's Thank You Rewards program thanked its customers by adding a $39 fee for all tickets redeemed through its CitiMiles program.

jupiterimages

AmEx's Delta Sky Miles "Always Double Miles" program on everyday purchases became "never double miles."

Getty Images