Cash + Holders, let's fight for our rewards!

[bs6054]

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@FutureBillionaire wrote:

As greedy as banks are, are we sure that they are dumb enough to launch a product uncapped with so much high potential spending without doing their due diligence to make sure it could be profitable?  They didn't anticipate that the bill pay would be a hot button category and potentially abused?  My argument is weak only if US Bank is in fact losing money.  I don't think that is the case.

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I don't think that is the case.

Well, that's a strong argument indeed!   OK, as I said, explain a) Restriction to applying in branch, reducing the availability of the product, b) the large number of changes happening at once.

Especially b!  In my (very big business) we try to change only a small number of things at a time  (generally negatives marketed as positives of course!) , firstly to make sure that the customers don't get scared away too much, but also so we can easily assess the value of the change, and course- correct if possible.   In this case, if market share drops suddenly, US BAnk will have to figure out the leading cause, was it the cap, the loss of categories, the one-time $25 bonus or some combination.

And indeed, the exception is when something goes badly wrong, and it just has to be shut down.   You pull all the levers to stop the loss, and maybe later try to understand if things can be tweaked, but you cannot go on losing money.

[FutureBillionaire]

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@bs6054 wrote:

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@FutureBillionaire wrote:

As greedy as banks are, are we sure that they are dumb enough to launch a product uncapped with so much high potential spending without doing their due diligence to make sure it could be profitable?  They didn't anticipate that the bill pay would be a hot button category and potentially abused?  My argument is weak only if US Bank is in fact losing money.  I don't think that is the case.

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I don't think that is the case.

Well, that's a strong argument indeed!   OK, as I said, explain a) Restriction to applying in branch, reducing the availability of the product, b) the large number of changes happening at once.

Especially b!  In my (very big business) we try to change only a small number of things at a time  (generally negatives marketed as positives of course!) , firstly to make sure that the customers don't get scared away too much, but also so we can easily assess the value of the change, and course- correct if possible.   In this case, if market share drops suddenly, US BAnk will have to figure out the leading cause, was it the cap, the loss of categories, the one-time $25 bonus or some combination.

And indeed, the exception is when something goes badly wrong, and it just has to be shut down.   You pull all the levers to stop the loss, and maybe later try to understand if things can be tweaked, but you cannot go on losing money.

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You make very strong points.  I wish I could see the numbers. 

I need a bill pay card.  I don't want to app for anything until summer.  I'm angrily in the garden.

[pkosheta]

Also there is no 100 dollar+ signup bonus.  CSP gave out 50k points and there was a plat amex for 100k not too long ago.  With no upfront cost to recover or liability on their books one would think they could be doing worse.  Imagine if they had given a nice sign up bonus too how much they would be pulling back.  Caps make sense, killing bill pay just makes me sad . I guess it will become my electronics/dept store card.  Although if bookstores includes amazon, I will forgive them somewhat.

[Open123]

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FutureBillionaire wrote:I guess this is why we have to bail out banks with tax payer money.  We can agree to disagree Open.  

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Absolutely!

If we agreed on every point, I can't imagine anyone bothering to read this thread.

[kekrre]

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@FutureBillionaire wrote:

As greedy as banks are, are we sure that they are dumb enough to launch a product uncapped with so much high potential spending without doing their due diligence to make sure it could be profitable?  They didn't anticipate that the bill pay would be a hot button category and potentially abused?  My argument is weak only if US Bank is in fact losing money.  I don't think that is the case.

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It's possible that the (profit) plan the entire time was to launch a loss leader, gather a bunch of users, and devalue the rewards program to weed out users and hold onto profitable customers.

It's entirely possible that they were basing their expected distribution of PIFs, balance carriers, defaults, etc. off of models that they had for their existing cards (because, you know, it's not like banks have never rehashed historical data models that failed to account for obvious fundamental simplifications or flaws). Thus it's possible that they expected the number of 5% exclusive customers to be lower, or for them to fall into a different distribution of balance carrying (that is, nonzero), or that they were naive and didn't realize how easily people would game uncapped 5% categories like airlines and bill payments.

They may have based their models off of what average people they surveyed paid in airlines and [select] utilities and not anticipated either an influx of people who would exlusively use those categories or people who would find loopholes for unexpected category bonuses or pay other people's bills for the discount (i.e. out of model parameters). Again, it's not like companies have never launched a program that was far more valuable than they realized, e.g. American Airline's lifetime first class passes (which they intended for corporate types).

I personally think it's much easier to argue that banks are naive or incompetent, than that they're malicious, since while you can create several plausible scenarios which would lead to a) no online applications (large influx of "deadbeats") and b) revised reward structure, the argument for malicious devaluation of the rewards program seems to be "banks are mean, banks only want my money". Of course banks want your money, but they also want you to be happy to give it to them.

[LesWH]

Darn!  This card was on my hit list for 2014 for the 5% bill pay!!

[RonDawg]

I agree that the they should have put some things in place to prevent abuse but from a PR stand point they wanted to get their name out there and the CASH + with no caps was a good way to do it.  The Bill pay was my favorit cat and I will miss it maybe in the future when they figure out how too work the cat they might bring it back.  At this point I have seen so many posts on here on how to abuse that cat it is not even funny.  The bank was taking a bath on it.  People were running entire business expenses through the bill cat. One post I read on here said he was pushing 20 to 30k in utility bills through it a month from his business. The Cash + card was a personal credit card not a business credit card so there for it was straight abuse.     Enough idiots do this and there goes the cat. 

I agree that putting a cap on it might have helped but in the end they must not have been making money on this cat, I never understood airlines on there, I mean a frequent travel person would make duckets back on that cat alone.  

The card did a good job putting US Bank on the map.  Remember all credit card companies change things when they start losing money.  I believe that most of the changes are caused by abuse. 

By not putting caps on it in the first place they must have wanted to be unique. They didn't look ahead much to abuse, a bad business choice on their end. 

Again this is just my opinion. 

If you don't like the changes and don't like the spending options then don't use the card. Its not like you lost something by having the card every last one of us including myself took advantage of the cats and got the MAX cash back we could.  We didn't lose anything and if you lost anything it was just a CAT and or a spending cap and $100/$25 rebate option. The card still works and is still a great card, there is still ways to get cash back.    

[FutureBillionaire]

We have proof that banks are malicious when we consider the mortgage crisis and how they treated the American people after making those terrible loans.  Let's not be naive here.

Regarding the card, I'm going to keep using it. I'm also going to voice my displeasure with the changes.  It's my right to do so.  The changes feel like bait and switch to me.  It is a frustrating situation to me as a consumer.  I acquired a product that isn't doing what I acquired it to do.  I think it is reasonable to ask for caps on the preexisting categories.  I believe everyone wins in that scenario.  The bank has the right ot disagree.  As such, other cards will get more swipe fees because I will use them more.

Fin.