Has your credit card company hit you with an unwarranted late fee? Have you been charged interest even though you paid your bill in full? Has your purported delinquency resulted in a usurious interest rate?
Facing increased competition, credit card issuers are becoming more creative--and not always principled--in generating revenue. "It's a problem that directly impacts business owners as well as consumers," says Linda Sherry of the nonprofit organization Consumer Action in San Francisco. Some issuers hit cardholders with charges ranging from exorbitant late fees to excessive interest rates. Hundreds of cardholders have filed lawsuits against credit card companies, accusing them of delaying the posting of payments (intentionally triggering late penalties), charging for products not ordered, arbitrarily raising interest rates and other outrageous moves, according to the nationwide consumer rights group.
Starting a business is hard enough without having to worry about getting ripped off. But if you're one of the millions of entrepreneurs using plastic to help finance your business, it may pay to worry-or at least to be more diligent about credit card matters. What you can do:
- Review the accuracy of each statement.
- Check payment due dates, as they can vary each month.
- Remit payments well in advance of the due dates.
- Have payments made automatically each month from your checking account.
- Reschedule payments for your convenience.
- If you are contesting a late fee, keep and use the canceled check to prove the payment was made on time.
- Reduce your use of credit cards.
- Make paying off credit card debt a priority.
- Never accept credit insurance.
- Don't accept invitations to skip a payment.
- Resist using unsolicited blank checks.
- Research credit card rates and terms at http://www.bankrate.com
- Visit Consumer Action online at http://www.consumer-action.org
Paul DeCeglie (MrWritePDC@aol.com) is a former staff reporter for Journal of Commerce and American Banker.