Chase Ends New $10 Fee on Cards

Chase has reportedly stopped charging they’re $10 monthly fee that they began in January.  New York Times reports that New York State’s attorney general,  Andrew M. Cuomo, pressured JPMorgan Chase & Company into agreeing to remove the fee.  After numerous complaints from Chase cardholders, Cuomo “demanded that Chase cancel the charges and refund the fees collected.”  In an agreement, it has been reported that more than 184,000 cardholders will be receiving $4.4 million dollars in refunds.

In an economy that seems to be sloping negatively, banks have been slowing down on their bonus offers and promotions and are now “tightening credit limits, raising standards and closing accounts” reports the New York Times.  And it is suspected that this was an attempt to generate income that Chase is losing due to the reduction in consumer spending.

Bankrate.com reported this story in November of 2008, 2 months before the fee was first levied.  When they asked about which accounts were to be affect by the fee the responded: 

“The fee you mention will impact one-half of one percent of our accounts on file. Those who are impacted have carried large balances for over two years while making little progress in paying them off. Beginning January 2009, we will be adding a monthly service charge of $10 to select accounts. We will also be increasing the minimum payment from 2 percent to 5 percent.”

There’s no surprise to hear that Chase cardholders were unhappy with this sudden change.  What scheme is Chase going to come up with next to take place of the fee and to recover the $4.4 million in refunds?

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