Chase Raises Minimum Payments on Credit Cards, Adds Fee

In an effort to crack down on consumers who hold large credit card balances, but don’t seem to make any progress in paying them off, Chase has upped credit card minimum payment requirements and added a related fee.

The credit card issuer notified hundreds of thousands of customers who carry balances and hold low promotional interest rates that a $10 monthly fee (that accrues interest) will be added to their accounts going forward.

Additionally, these customers will be required to make larger monthly minimum payments; instead of 2% of the balance, 5% will now be required each payment cycle.

That’s a substantial jump in minimum payment, as those targeted by the policy have been known to hold large balances for over two years with little repayment, according to a Chase spokeswoman who spoke with USA Today.

But apparently Chase is offering customers who phone in a second alternative, a higher fixed APR set at 7.99% (is it really fixed?).

Customers are understandably upset because Chase promised a low fixed rate for the life of the balance, but now look to have gone back on their word.

Of course, the whole changing of terms seems to be the norm with credit card issuers, which makes you wonder if a fixed rate is ever truly a fixed rate.

For situations like this and many others, it’s important to ensure you don’t spend more than your means, and always have a backup account to make larger payments if necessary, especially in these turbulent times.

Chase is the largest credit card issuer in the United States, so the fear now is that other card issuers will follow suit, putting the squeeze on already stretched card holders.