C.Ann said:
Credit card companies are notorious for doing all sorts of underhanded things.
Semantics: I need to make a clarification here - the credit card
companies - Visa and Mastercard (can't speak for the other smaller players) do not receive ANY of the interest or fees that a consumer pays. Visa International is a VERY ethical payment company.
Credit Card issuing
banks (i.e. Citibank, Chase, etc.) are totally responsible for the relationship with the consumer. They set interest rates, fees, provide billing, customer service, etc. They keep ALL of the money from these fees.
Visa and MasterCard get approximately a penny per transactions for switching the transaction between the merchant bank and the issuing bank. Visa doesn't care) whether it is a debit or a credit transaction - how the payment is made by the customer is part of the banking relationship between the bank the and the customer.
I went to work for Visa when it was very small in the 80s (less than 500 employees worldwide). I was hired to set up the debit programs and spent many years promoting debit products. I really, really know this business.
I have NEVER heard anyone at Visa use the term "deadbeat" - mainly because NO ONE at Visa knows how you pay your bill (debit, paid in full or revolving). I don't doubt that some bankers have used this term, but I would be really surprised to hear a Visa employee use the term.
For one thing I don't know of anyone at Visa who revolved their credit cards - so they were all "deadbeats" by the definition on the TV program. We certainly knew better.
Also as Visa employees we were subject to extremely rigorous reviews of our financial history. You don't want someone in financial trouble being tempted to commit fraud (not that the vast majority of people would). More than once I could not hire an employee because their credit was not squeaky clean. Visa settles over a billion dollars a night during the non-peak periods.
For many years you could not get a credit card unless you had pretty good credit. The introduction of "sub-prime" cards by Capital One and Providian really changed the industry. About a decade ago I remember there being a sort of stigma attached to carrying one of those cards - it was sort of an announcement that you had bad credit. (not true today).
Other credit card issuers soon realized that if they charged enough interest it more than made up for the increase in defaults by giving credit to people with poorer credit scores. And around the same time that credit was being given out more liberally, there was a parallel social shift to having CC balances being more socially acceptable.
For many, many people in my age bracket (almost 60) carrying a credit card balance is a big no no. It just isn't done by responsible individuals except for a very short term or in an emergency.
I continue to be surprised by the number of people who run credit card balances forever and continue to charge on the cards. I do understand paying for something big over a few months or having to use them because of a financial emergency (medical or job loss), but it's the constant use without regard for ever paying off the balance that amazes me.
I started work in the credit industry in 1963 - at the credit bureau reading credit reports before they were ever computerized.
I am old, and it's a different world out there now.
Specifically, I am trying to find out how hannaford's, Stop and Shop, and Lukoil are categorized by citibank, because that's where we shop most often. If I can't find a list, I'll just have to call them later (after I get off the phone with Disney visa trying to sort out the latest issue).
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