Do credit card minimum payments really make sense?
This is from my very own credit card statement.
In what reasonable sense of business does a credit card company allow someone to pay such a small amount each month that it would take 34 years to pay off their balance? If you’ve seen The Secret History of the Credit Card (PBS Frontline) you know why this makes business sense; banks make way more than just interest off of customers that pay only the (extremely undersized) minimum payment, in the form of late fees, much higher rates, and the like.
So, the next time you hear of a bank complaining about customers not being responsible and paying off their credit cards, remember the credit pushers that got the customer hooked in the first place.
I pay off my bill in full every month by the way. 🙂
Interesting | admin March 17, 2011
