Today CardHub.com released a study that revealed a serious flaw in the way American Express determines the past due status of its customers.
The study evaluated the late payment policies of the six largest credit card issuers and found that American Express was the only issuer in this group to consider a customer 30+ days past due in a circumstance in which other issuers would consider a customer only 5+ past due.
Major Implications:
• American Express is out sync with the rest of the industry. The last thing that consumers need right now is an open door for each credit card company to come up with their own method for determining their customers’ late status.
• American Express is communicating an incorrect message to its customers, telling them that they are 30+ days past due when they have only missed their payment deadline by a few days. This may cause stress for those who know that most credit card companies will report them to the credit bureaus once they become 30+ days past due.
This aggressive late payment policy also raises questions about when American Express applies the penalty APR to its customers’ accounts and whether or not it inflates its customers’ delinquency status when reporting to the credit bureaus. CardHub.com contacted members from both the Customer Service and Public Relations teams at American Express to ask about these policies and got conflicting answers.
For full details of the study, please visit this link:
http://education.cardhub.com/late-payment-policy-study-2010/
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