Excessive charge by bank on credit card

COMMENT POSTED IN MY BLOG:

The bank did the right thing by informing customers early and proper disclosures.

Consumers also have their own responsibility in managing their own cash flow. What the banks did was to create convenience for consumers so that they do not have to carry large amounts of cash and at some places, enjoy discounts and rebates.

If they did not set up the framework, consumers would still be carrying large bundles of cash with them all the time.

If you are expecting everything to come without cost, then you have to carry your own bank with you all the time.

Banks do not owe consumers a living. If consumers make use of their services, please expect to pay.

I have never been late in my credit card payment - even with banks where I do not have a GIRO arrangement. Why? It is simple - I make sure honour the rules, and am not tardy nor procrastinate my payment.

Perhaps consumers can consider practicing not delaying payment and avoid unnecessary penalties.

REPLY:

It is all right for the bank to incur a charge to cover its actual cost of handling the late payment. I believe that the cost should be less than $5. It is not correct for the bank to levy an excessive charge (just like imposing a fine) and make a profit on it.

Already, the bank is making a profit on the following:

1. Charge paid by the merchant
2. Annual fee for the credit card (although it is usually waived)
3. Interet on late payment.

I am worried that many businesses are aiming to increase their profit all the time, and they adopt are willing to business practices that are unfair to consumers. I urge consumers to reject these types of business practices.