Over the past month, a few of the major credit card issuers have announced some consumer-friendly changes they are making to their practices.
Just a couple of days ago, Citibank announced that it will end its practices of:
- “universal default” — where an individual’s interest rate can be hiked if the borrower misses a payment with another lender, even if the borrower is otherwise current.
- “any time for any reason” — where the lender can change the rates and fees due whenever they deem fit. With the announced changes, as long as the borrower pays on time and stays within their credit limit, Citibank will only change the margin on their interest rate and fees when a card expires and a new one must be issued.
Several weeks ago, Chase also announced that it will end using the controversial “two-cycle billing” method, where borrowers are charged interest on a two-month period, rather than a one-month period, if they do not pay their balance in full. Under that policy, consumers who do not pay their balance in full end up paying interest on principal they have already paid off.
That the timing of these announcements coincides with the commencement of a series of congressional hearings by the Senate Banking Committee and House Financial Services Committee on credit card industry policies, I don’t think is a coincidence. Does it portend more changes to come? Time will tell, but based on the results so far, it seems likely.
This thread at FW notes a very interesting offer: The Elite Level version of Citi PremierPass is being offered with the annual fee of $75 waived. The offer also includes the standard 15,000 bonus points. The link to this offer can be found here.
Note that the linked page says “Annual Fee Waived.” It’s unclear whether it’s referring to merely the first year of the annual fee being waived or if it would be waived permanently. If you open up the application and then look at the terms and conditions, under the heading of “Annual fees” it says “None.” That might lead you to believe that the fee waiver is permanent.
It’s a little puzzling, however, because then one wonders why Citi would even bother placing both the Elite level and the standard level of the card on the same promotional web page. Without the annual fee, the standard PremierPass has no advantage over the Elite level, as the Elite PremierPass has superior points earning capabilities, among other things. Based on this reasoning, my guess is that the intention of the offer is that only the first year’s annual fee is waived. I believe anyone who applies with the expectation that they will be forever exempt from the annual fee will be disappointed, but I would be happy to be proven wrong.
This offer features:
- 5 ThankYou points for every $1 spent at supermarkets, gas stations and drug stores during the first 12 months, and 1 ThankYou point afterwards. 1 ThankYou point per $1 spent anywhere else.
- 0% APR and no fee on balance transfers until January 1, 2008.
- 10,000 ThankYou points, redeemable for a $100 gift card, with first purchase within 3 months of signing up.
Visit www.signup.citicards.com and use offer code F1N9 or call 1-800-961-5096 by February 15, 2007 to apply. This offer also has been added to the offers database. Via FW.
Note: The above offer has expired. See the current offer for the Citi® Diamond Preferred® Rewards Card.
Here’s an offer that sweetens the standard deal of 10000 points after your first purchase with the Citi Professional Card. As with some of its other credit card applications, Citi is offering a bonus of 5000 points if you are a reluctant applicant. That is, if you go to the Citi Professional application page, then browse away without filling in the form, a popup will appear, offering you an additional 5000 points for a total of 15000 points, redeemable for a $150 gift card, after your first purchase with the card.
The direct link to the additional bonus is here. Via FW. This offer has also been added to the credit card offer database.
FW points out the following offer for the Citi Diamond Preferred Amex, where you get 10,000 ThankYou points upon first purchase, rather than the standard 6,000, and the BT intro period lasts until December 2007. All other terms are basically the same as the standard offer. That is, there’s no fee associated with the balance transfer, and you get 5 ThankYou Points for every $1 spent at supermarkets, drugstores and gas stations for the first 12 months.
To sign up under this offer, visit http://www.signup.citicards.com and enter offer code F1M3 or call 800-601-8595.
This is a targetted offer, so unfortunately you’re out of luck if you didn’t receive the e-mail. According to this thread at FW, you might be solicited for this offer if you already have a Citi Student card. Basically, for each person you refer that applies and is approved for a Citi Card for College Students through the link provided in the e-mail, you’ll receive a $100 statement credit, up to a maximum of 5 approved accounts.
Your referrals must apply by October 31, 2006 to qualify.
To help promote their new credit card, Home Depot is teaming with MasterCard to hold a $100,000 sweepstakes. Every time you use a MasterCard to make a purchase at a Home Depot, EXPO® Design Center, or Home Depot® Landscape Supply location in the U.S. between September 7 – October 31, 2006, you’ll be automatically entered. You’ll receive two entries if you make the purchase with the new Home Depot Rewards MasterCard card or Home Depot Business Rewards MasterCard card.
You can get a pretty fancy kitchen for $100,000. Fortunately you receive your winnings in the form of a check, in case your kitchen doesn’t need $100,000 of upgrades.
More information can be found at http://www.homedepot.com/mastercard.
…but the results are a bit underwhelming. CardTrak reports that Home Depot has partnered with Citibank to launch its first pair of co-branded general purpose credit cards. The Home Depot Rewards Mastercard has both a consumer and business version. Under both programs, you earn 2 points for each dollar spent at Home Depot or EXPO Design Center and 1 point everywhere else. Points can be redeemed for the usual assortment of gift cards, merchandise and travel. As an example, 2500 points can be redeemed for a $25 Home Depot gift card. You’ll also earn a bonus 2500 points upon making your first purhcase. More details can be found at http://www.homedepot.com/cards.
Compare this to the existing Chase Home Improvement Rewards card and it doesn’t stack up so well. The Chase card offers 3 points per dollar on any home improvement purchase. Chase’s definition of home improvement purchases are “those purchases made at retail establishments classified by the retailer to Visa and MasterCard as being a home supply warehouse store; a lumber/building supply store; a glass/paint/wallpaper store; or a hardware store.” You earn 1 point per dollar anywhere else. It too allows redemption of 2500 points for either a $25 gift card or a $25 check.
Editor’s Note: The following info is oudated. For the latest details on the Citi Dividend Card, see this link.
Various message boards have been abuzz recently with rumors that the Citi Dividend card will soon no longer offer 5% cash back on supermarket, drugstore and gas station purchases. One such thread is on FW here.
Based upon several conversations with Citi CSRs, the general consensus is that changes are coming. And according to one poster who says that they have already received the new terms, they are:
- 2% for supermarkets, gas stations, drugstores, convenience stores and utilities including cable.
- 1% on all other purchases.
- Maximum of 300 Dividend Dollars in a calendar year.
- Utilities include electric, gas power, water supply and refuse services, but not telephone service. Cable includes satellite and other pay television and radio service.
The new terms should be mailed out to customers over the next month or so. If these new terms are indeed rolled out, it obviously represents a huge downgrade in benefits to existing cardholders. Then again, these type of changes should not be that unexpected, considering Citi was likely losing quite a bit of money on customers who only used the card for gas, grocery and drugstore purchases. It also follows Chase’s decision back in April to discontinue its own 5% cash back program.
The obvious question is what to do now. Already folks at FW have suggested the HSBC Direct Rewards Platinum Mastercard as an alternative. It offers:
5% CashBack at supermarkets, drugstores and gas stations. For other stores, 0.5% on up to $3K purchases, 1% for more. CashBack capped at $500 for any yearly anniversary period of the account. CashBack is paid annually, anything less than $10 is forfeited.
There are a few other potential downsides, including a reputation for low credit limits. Perhaps more importantly, one would almost expect that should HSBC receive a huge influx of new applications in the short-term, that these terms would be short-lived as well.
I personally find this offer very interesting. Well, not so much the offer itself, but the manner in which to get it. This thread at FW points out that for the Citi Business card, you can get an extra 5000 bonus Thank You points (for a total of 15000) when you signup if you pretend you don’t really want the card at first. As the poster states:
went to apply for citi business (the one with 10000 bonus) hit back button on my browser, and got a popup offering another 5000 if i don’t back out and go apply, as in 15000 total bonus points to sign up just because i almost didn’t
More accurately, if you apply on Citi’s web site itself (http://www.citicards.com), click on the Small Business Credit Cards link, then click the “Apply Now” button for the CitiBusiness Card with ThankYou Network, it will create another window with the application. If you then close that window, another popup will appear, offering you another 5000 points for completing the application. Such is the world of marketing that we live in today.
On a side note, when I first tried to test this, I was using Firefox with my pop up blocker automatically turned on, so the popup didn’t show. You’ll need to disable any popup blockers you have in order to see this offer.