Consumers might be paying more than credit card perks are worth, officials say
Source: NBC News
May 9, 2024, 5:07 PM EDT
Credit card holders could be paying more in fees and interest than their travel rewards and other perks are worth, Biden administration officials are arguing, raising scrutiny on loyalty programs that shape millions of peoples spending.
The Consumer Financial Protection Bureau and the Department of Transportation held a joint hearing in Washington on Thursday that brought together representatives from airlines, financial institutions, unions and consumer advocacy groups to discuss whether new regulations are needed.
Regulators are looking into the promises made around sign-up bonuses, changes to point values, obstacles in redeeming points and loss of rewards when cards are closed. Theyre especially focused on travel rewards, like those offered by airline-branded credit cards that let users rack up frequent flyer miles. Forty-one percent of Americans have travel rewards credit cards, according to a NerdWallet survey last year.
Were going to look into how we can make sure companies are being straightforward about what people will get from these frequent flyer miles or loyalty programs when they sign up, and whether people are actually getting the deal that they were promised, Transportation Secretary Pete Buttigieg said at Thursdays hearing.
Read more: https://www.nbcnews.com/business/consumer/credit-card-rewards-high-fees-rcna151281
SWBTATTReg
(22,580 posts)I only have one card that I actually get award points, one that I have for my home owners' insurance too, so it benefits me a couple of ways besides the points. Other than that, none of the cards offer anything that I would jump for. It's not worth the aggravation and worry.
Wonder Why
(3,661 posts)conditions on the cards or those of the company who's affinity you are buying - like the airlines, hotels, chain stores, etc. They can do anything to you any time and the only thing you can do, if you are lucky, is to use arbitration, which itself is heavily in their favor.
PSPS
(13,711 posts)Lucky Luciano
(11,286 posts)Lots of points. No interest. There are fees we make back and some other perks. Its not amazing or anything, but I feel like I get a small edge.
Aussie105
(5,664 posts)But how many people does that apply to?
Often it is people short of money to start with, who are looking for that 'I bought something and now I feel good, and look at the rewards!' endorphin kick, and figure future they will find the money to pay it back within the interest free time.
If everyone with a card did that, the banks wouldn't be offering them.
I prefer a debit card, where I spend money I've earned in the past.