topic Re: Why a RJ on a PIF? in Credit Cards

Why a RJ on a PIF?

Anonymous — Wed, 18 Nov 2009 20:01:24 GMT

I've been wondering this...the CC company can see if we PIF or if we give them money (interest). So why would they RJ someone that never pays interest? I mean I understand the people here have been upset about a rate going from 10% to 29.99% (CITI, Chase, etc) but if you always PIF and never pay interest, it doesn't REALLY matter to you, financially. And they know that even with the new rate, chances are you STILL won't be paying interest, so why do it and make the customer mad?

Wouldn't it make more sense to add an AF or a "minimum of $2,500 per year or you'll be canceled" to the cards for those that PIF (not that I am trying to give anyone an idea!)?

Just my thoughts...

Re: Why a RJ on a PIF?

MarineVietVet — Thu, 19 Nov 2009 02:12:51 GMT

@Anonymous wrote:
I've been wondering this...the CC company can see if we PIF or if we give them money (interest). So why would they RJ someone that never pays interest? I mean I understand the people here have been upset about a rate going from 10% to 29.99% (CITI, Chase, etc) but if you always PIF and never pay interest, it doesn't REALLY matter to you, financially. And they know that even with the new rate, chances are you STILL won't be paying interest, so why do it and make the customer mad?

Wouldn't it make more sense to add an AF or a "minimum of $2,500 per year or you'll be canceled" to the cards for those that PIF (not that I am trying to give anyone an idea!)?

Just my thoughts...

Both those ideas have been talked about around here. We'll just have to see if either is implemented.

Re: Why a RJ on a PIF?

Anonymous — Thu, 19 Nov 2009 02:53:21 GMT

Don't take it personally it's just all about money right now...Citi is taking massive....and i mean massive losses and they have no other way to make it up other then rate-jacking and changing misc fee's 29.9% times say 10 Million customers which Citi has Multi Millions and u get the picture on why they are doing what they are doing. Even if you don't carry a balance they are increasing it just in case you do ever decide to carry one. It's the new reality......sad but true for most of the large banks...You don't see Credit Unions pulling these types of Schemes....and one reason why that is, was Credit Unions did not take on all of these losses like the banks did. The Banks received their bailout money now they are going crazy with greed. Sad really......Just my thoughts on this.

Re: Why a RJ on a PIF?

clocktick — Thu, 19 Nov 2009 03:08:39 GMT

It could be an across the board RJ meaning whether you PIF or not. Also, there's not a saying, "once a PIFer, always a PIFer." Unfortunately, some PIFs eventually do end up paying interest down the line or worse, end up defaulting. Lastly, if the customer always PIF, why would they be mad?

Re: Why a RJ on a PIF?

score_building — Thu, 19 Nov 2009 03:34:24 GMT

@clocktick wrote:
It could be an across the board RJ meaning whether you PIF or not. Also, there's not a saying, "once a PIFer, always a PIFer." Unfortunately, some PIFs eventually do end up paying interest down the line or worse, end up defaulting. Lastly, if the customer always PIF, why would they be mad?

they may just not like the ill will RJ suggests, it crosses over into a trust issue for some and there is a segment of pif card holders who always prefers the lower rate where available.

Re: Why a RJ on a PIF?

Anonymous — Thu, 19 Nov 2009 03:36:53 GMT

The stratospheric RJ's are not intending to make more profit. They are intended to keep you from carrying a balance.

So, for those RJ's that are 29.99 and higher....they don't want you to carry a balance and have priced it accordingly. If they wanted a balance, they would offer to BT with no fees, offer promo rates, offer lower interest rates or other incentives to obtain balances.

If they wanted balances from purchases, then they woudl offer promo rates, rewards or rebates, extra protections or incentives to get you to feel inclined to make larger ticket purchases that you won't be paying off at the end of the month.

Free markets are free markets. Increased prices or taxes reduce consumption, increase value (including reduced prices) increases consumption.

When the rates are double "normal rates" you know they are not looking for balances. And if you carry one, you may find AA at some point. Why? Because it does not make sense for a prime customer to pay 30% interest on balances. This seems as a sign of financial issues, that you need the money and can't afford to pay it back quickly, meaning you are leveraged and have done so at extremely high interest.

IMO.

Re: Why a RJ on a PIF?

Anonymous — Thu, 19 Nov 2009 04:58:27 GMT

@MarineVietVet wrote:
@Anonymous wrote:
I've been wondering this...the CC company can see if we PIF or if we give them money (interest). So why would they RJ someone that never pays interest? I mean I understand the people here have been upset about a rate going from 10% to 29.99% (CITI, Chase, etc) but if you always PIF and never pay interest, it doesn't REALLY matter to you, financially. And they know that even with the new rate, chances are you STILL won't be paying interest, so why do it and make the customer mad?

Wouldn't it make more sense to add an AF or a "minimum of $2,500 per year or you'll be canceled" to the cards for those that PIF (not that I am trying to give anyone an idea!)?

Just my thoughts...
Both those ideas have been talked about around here. We'll just have to see if either is implemented.

Citi has already implemented such a program for a select (large) number of cards on a test basis.

Re: Why a RJ on a PIF?

Anonymous — Thu, 19 Nov 2009 05:00:24 GMT

@clocktick wrote:
It could be an across the board RJ meaning whether you PIF or not. Also, there's not a saying, "once a PIFer, always a PIFer." Unfortunately, some PIFs eventually do end up paying interest down the line or worse, end up defaulting. Lastly, if the customer always PIF, why would they be mad?

It's not across the board.

Re: Why a RJ on a PIF?

Anonymous — Thu, 19 Nov 2009 14:19:32 GMT

Sorry for my ignorance, but I am trying to figure out what "RJ" stands for.

Thanks!

Re: Why a RJ on a PIF?

Anonymous — Thu, 19 Nov 2009 14:27:41 GMT

Hi rlsrlj,

"RJ" = Ratejack = Outrageous APR hike

Re: Why a RJ on a PIF?

Anonymous — Thu, 19 Nov 2009 14:58:46 GMT

THANK YOU...I know exactly what that is-thanks to First National!