Small-Business Credit Card Protections on the Way?
Support builds for Congress to pass a small-business credit card “bill of rights.”
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PrintCredit cards are like a water balloon: squeeze them in one place and they’ll bulge in another. So when the president signed the Credit Card Accountability, Responsibility and Disclosure Act (which protects consumers from retroactive rate increases, double billing, short billing cycles and other gouges) credit card issuers reacted in predictable fashion: they jacked up every rate and fee they could think of that’s not covered by the CARD Act. A lot of the new charges have hit small-business owners, many of whom rely on their credit cards just to meet day-to-day cash-flow needs. For example: the new Ink line of cards from Chase. Targeted at small business, the cards come with interest rates up to 30 percent. (We know loan sharks who charge half that.) Now, though, momentum is building to extend the CARD Act protections to small-business owners as well as consumers. (We’ll just have to wait and see where the balloon bulges next.)
The great lite north. Touchingly, our upstairs neighbors think they can lower credit card fees by asking nicely. Canadian finance minister just proposed that credit card issuers there volunteer to lower their fees. (That’ll happen about as soon as Satan is building snowmen. Or the Jays win the World Series. Whichever comes first.)
Reward points? Use ’em or lose ’em. We have mixed feelings about this item. On the one hand, we’re irritated by reports that credit card issuers are looking for revenue by making it harder for you to redeem your rewards points. On the other hand, we’re equally irritated by people who use their credit cards to buy everything just to earn a point or two. (“You! Paying for your $3.25 latte with a credit card. Yeah, we’re talking to you!”)
Speaking of water balloons. Dan Drechsel, CEO of a small-business “financial solutions” company called Financial Transaction Services, says community banks squeezed hard by losses on commercial real estate loans will expand their credit offerings to small business. Drechsel reports research by his firm indicates 86 percent of community banks say small-business lending will become an important revenue stream for them in...the next 10 years. (Hope you can hold your breath that long.)
The great lite north. Touchingly, our upstairs neighbors think they can lower credit card fees by asking nicely. Canadian finance minister just proposed that credit card issuers there volunteer to lower their fees. (That’ll happen about as soon as Satan is building snowmen. Or the Jays win the World Series. Whichever comes first.)
Reward points? Use ’em or lose ’em. We have mixed feelings about this item. On the one hand, we’re irritated by reports that credit card issuers are looking for revenue by making it harder for you to redeem your rewards points. On the other hand, we’re equally irritated by people who use their credit cards to buy everything just to earn a point or two. (“You! Paying for your $3.25 latte with a credit card. Yeah, we’re talking to you!”)
Speaking of water balloons. Dan Drechsel, CEO of a small-business “financial solutions” company called Financial Transaction Services, says community banks squeezed hard by losses on commercial real estate loans will expand their credit offerings to small business. Drechsel reports research by his firm indicates 86 percent of community banks say small-business lending will become an important revenue stream for them in...the next 10 years. (Hope you can hold your breath that long.)
