Why would Citibank want to cancel cards in credit????

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gregff

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I saw a change to the T&C's of my Citibank credit card that if a card has a positive balance (i.e. in credit for example to allow larger charges overseas) for over 45 days, they have the option of cancelling the card after trying to contact you.
Why ever would they want to do that?
I also notice that a missed payment now costs a $40 fee!
The 45 day canellation seems unexplainable (you would lose all your points).
 

one9

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gregff said:
I saw a change to the T&C's of my Citibank credit card that if a card has a positive balance (i.e. in credit for example to allow larger charges overseas) for over 45 days, they have the option of cancelling the card after trying to contact you.
Why ever would they want to do that?
I also notice that a missed payment now costs a $40 fee!
The 45 day canellation seems unexplainable (you would lose all your points).

Credit cards are not designed to be used as bank accounts.

1. When you have a credit balance, you are using your own money, which means the bank does not have the potential to earn interest from you.

2. By having a credit balance, you add liability to both you and the bank in the case where someone else uses your funds without your authorisation.

I think adding some extra funds so you have a credit balance now and then is fine (eg if you need to make a big purchase). But the banks don't want to see that your account is ALWAYS in credit (eg. in credit for 45 days!!).
 

johnsmith

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one9 said:
Credit cards are not designed to be used as bank accounts.

1. When you have a credit balance, you are using your own money, which means the bank does not have the potential to earn interest from you.

2. By having a credit balance, you add liability to both you and the bank in the case where someone else uses your funds without your authorisation.

I think adding some extra funds so you have a credit balance now and then is fine (eg if you need to make a big purchase). But the banks don't want to see that your account is ALWAYS in credit (eg. in credit for 45 days!!).


I use my credit cards as bank accounts and have not ever had any complaints, i would imagine that the banks would be more than happy to have use of my funds for 45 days rather than me using their funds for 45 days. I would hope that Citibank would send you the funds that you have in credit after they have closed your account.
 
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NM

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I have a CBA Mastercard that I used to use for overseas cash withdrawls a few years ago and have not used since. It has no annual fee but also no linked to the CBA Rewards program so I juyst keep it ticking along. Its has a $4.10 credit balance for about 3 years now. Hardly a candidate for money laundering :p.

I guess one day I might actually buy something with that card (perhaps a few packets of Tim Tams from Coles??) and zero out the balance. But for now I am happy for CBA to invest my $4.10 for their own benefit and carry the card as an emergency spare. So I hope they don't take the same policy and cancel it. I had better actually read the statement they keep sending me to check that I am not being given 45 days warning :shock:.
 
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