I’ve begun getting comments from visitors who are being asked to do a $5000 balance transfer with Citibank in order to receive an interest rate lower than the 29.99% offer currently being pushed on consumers. At this point, only two reports have come in to Smart Balance Transfers, so we don’t have a ton of information of this deal. We are also unsure of the complete terms of the deal and whether or not this is something customer service reps are offering or part of a letter being sent to customers. Here’s a comment we recently received:
“Citibank credit card users across the country rec’d RATE HIKE notices this week – 21.99% !!!!! Seems the only way out of this soon to be illegal practice of BAIT & SWITCH is to “transfer” another $5000.00 to them!”
While this aggrieved customer may not be correct about a bait and switch, her complete posting contains some valid points. What strikes me most is the way this offer tries to lure customers into staying with Citibank. It is not a good deal. Consumers can opt out and keep their old rates. And if they want to do a balance transfer, there are good credit card companies offering 0% balance transfer deals lasting one year (you can view 0% balance transfer offers in the main section of this website).
Ultimately, consumers getting punished by Citibank with rate increases should go out of their way to stop paying interest to Citibank, whether by paying their bills off in full or transferring balances to another credit card company. No one should accept a 29.99% interest rate unless they intend to never pay interest and no one should accept a 15% balance transfer offer when there are 0% balance transfer deals available.
Citibank’s decision to charge customers 29.99% is shameful. It is causing Citi to lose their best customers and pushing other customers to the brink of bankruptcy. So unless you want to help support this type of predatory lending, opt out of your Citi card, ignore the Citibank balance transfer offer, and transfer your balance to a company that won’t try to squeeze every penny they can out of you.
November 17th, 2009 at 9:05 am
I got this letter. I had to transfer $3000 or more in order to keep my current terms. Otherwise my rate would be raised to 19.99%. Reading your articles I realize that 19.99% is a bargain, but it still sucks. I opted out and canceled the care. Yes, I have excellent credit, pay in full each month ($1,000-1,500), and have been a good customer for 15 years. The customer service agent did not offer me any other terms.
November 17th, 2009 at 10:31 am
Good Customer,
19.99% is no bargain. Sorry if something I wrote lead you to believe otherwise. Perhaps I was being sarcastic, but unclear. No one with good credit should be paying more than 15%-anything more than that should prompt you to move your balances to a new credit card.