Thursday, November 12, 2009

Consumerist Hotline: Citi Doubles Your Interest Rate Unless You Transfer $5000 More Onto Card:

The message, edited for style and clarity, goes:

"My name is Kent, and my husband yesterday we got a mailing from Citibank.

They're basically threatening to double the interest rate, or, not threatening, they were doing it. They're saying the only way he could lower it is if we transferred $5,000 in balances from any other card we may have. We have a balance on the card, but we haven't used the card in over a year.

So, basically, here, run up more credit. My husband say, this isn't acceptable, and he negotiated with them, and was just kind of hard with them.

They kept saying over and over again, "It's the increasing cost of doing business, it's the increasing cost of doing business." It was their constant refrain. The people were very well trained to stay on their message points.

It was interesting, they were basically saying "here, run up more debt." Obviously that's their business but it's irresponsible for anybody.

And it's just insane. The woman even said, "Well, we can do this." Well, we'll see."

So let's get this straight. Bankers have to increase credit card interest rates to "price for risk," which, supposedly, is the increased risk that debtors will default in this economic client. But here, Citi is saying, become a riskier customer by putting more debt on this card, or we'll punish you by doubling your interest rates.