This is one of those cases where I wish for some way for both sides to lose. It seems clear to me that this woman is a scam artist, and that AmEx distributes credit cards to the four winds in the expectation of extracting late fees and interest from the unwary.
One example of snaky credit-card company practice that cannot be avoided exercise of personal responsibility are those “call this number and read this invitation code” credit card offers. They create a serious security risk to the (intended) recipient, and ought to be illegal on that basis.
My credit card company did the same thing (when I bought a computer for about $1800 after a long history of never charging more than about $600/month). It’s a prudent precaution.
Wow, a lot of you seem to know privileged information about credit card business models. Care to elaborate how you came by such juicy info?
Wow, a lot of you seem to know privileged information about credit card business models. Care to elaborate how you came by such juicy info?
Um, we’ve read the fine print? Seriously, none of this is any big secret, so the fact that people are surprised by it is a little scary.
Or have I been whooshed?
Oh? Things like this are in the fine print on your credit card statements?
Since all of the above statements are incontrovertibly wrong, I was wondering how various dopers had gotten their hands on this information.
My statement is not wrong, controvertible or not.
Of course it is. The relationship between regulation and the interest rate you pay is by no means as simple and direct as you suspect.
Who do you think would pay for the high costs of compliance and the higher capital and reserve requirements that more regulation always entails?
Let me give you a hint. The FFIEC enacted much stricter regulatory guidelines in 2000 and again in mid-2002. This has caused major credit card companies to alter considerably the composition of their cardholder balances. Now you tell me, Fear Itself, have your interest rates gone down?
Can you actually explain to us just what the relationship is between revenue from interest on revolving credit card agreements and cardholder risk is?
Bravo! I laughed, I cried, I bought the movie on my Credit Card!
Actually, AmEx markets charge cards heavily to college students because they have (for many decades) been a good bet to become very solid customers when they graduate. It’s the same reason Apple gives student discounts. Late fees and interest? Well, the charge cards don’t let you carry a balance, so interest isn’t a factor. Late fees are not where AmEx makes their money. They want customers like PunditLisa who make lots of charges and pay them off every month, so they can get money from the merchants by charging them a percentage of every transaction.
Am I a big fan of AmEx cards? Nope. Don’t have one myself. But I do know their business doesn’t revolve around getting people to carry debt.