Banks always make money. Always. Even when it appears they won’t, they do their best Jurassic Park imitation and find a way.
We gave you a heads up a few months ago, and now it’s happened - a rule change seems to put them in a bind, especially combined with a major settlement that also cut their fees. But let’s not be hasty with predictions of doom on their behalf. There’s more going on than you might think.
Here are Five Fast Facts on bank and credit card fees:
- 💵 A Day Late And A Dollar (Or More) Short - The Consumer Financial Protection Bureau (CFPB) recently capped credit card late fees at $8 for a first violation. This is down from $32. Shortly after that, Visa and Mastercard agreed to a $30 billion settlement with retailers to cap credit card swipe fees for a few years.
- 🤯 Big Deal - This is a big deal because Americans pay $14 billion in late fees every year. The new rule could cut that down to around $4 billion. That’s waaaaay better!
- 💳 Retail Therapy (Or Not) - The drop in retailer swipe fees could theoretically be passed along to customers, but it is *ahem* unclear if they will do so or just pocket the savings.
- 🤔 Getting Creative - For being professional number crunchers, banks and credit card companies are really creative and they live in the fine print for their revenue streams. When one is closed down, they find a way to open another. Maybe they increase some fees over here or raise some rates over there, or maybe they downgrade rewards programs. Maybe they put services behind a paywall of some kind. The point is, they’ll be that Jurassic Park dinosaur…and find a way.
- ⚠️ Buyer Beware - And this, my friends, is where you come into the picture. You can bet they’ll find a way, but will it be something that affects you? Will you notice it even if it does? The next time you open your bank or credit card statement, you’d better check things over carefully and see if anything new has popped up suddenly. It could just be their new door opening a crack.
🔥Bottom line: It’s a frustrating game of whack-a-mole. The only real way to stop it is for the government to step in and actually slap them with some wide-reaching rules that apply across the board. Given how banks cozy up to Congress more than a gold digger to a rich old guy, we’re not sure how likely that’ll be.
What do you think?
Let us know by connecting with us on Facebook and Instagram! Also, remember to share this newsletter with your friends & coworkers!
BTW, If you’ve read this far and haven’t yet signed up for the weekly Paycheckology newsletter, CLICK HERE!
