Should we just accept devaluations and paying for them as a way of life?

[abhishek0882]

I think with the recent trend of credit card devaluations and almost all banks falling over each other to devalue their cards, we as consumers have just accepted it as a reality and move on, moving from one card to another.
My issue is, when we sign up for any subscription (which effectively credit cards are), we look at what we are getting against the subscription price and based on that we decide whether to purchase the subscription or not. Now, if we have paid an annual fee upfront for a set of features and services, we expect to receive those services for the year/subscription period. Minor changes are acceptable but if the key features are taken away, what is the point of what we paid for. I understand that the TnC already mention that the bank may change the offerings at any time and we all have agreed to those terms, but is that acceptable? One solution could be that a bank should be able to effect changes in a card only at renewal, not in between. So the changes will not come into effect together for all cardholders, but in a phased manner as per the renewals. Another option could be, if major changes are made in the offerings, is it not fair that we should have the option to cancel the card and be entitled to get a refund of the fee on a pro rata basis, for the period used? Or have a monthly fee so that as soon as changes are applicable, if the card is cancelled there is minimum loss. Banks are now launching cards with a lot of features, getting people in and taking the upfront fees and within a few months devalue it, seems like it has become a scam.
I know I may receive some sarcastic responses and people making fun saying thats how things function and since we have agreed to the TnC, nothing can be done about it. Well we sign a lot of TnC but if they are not in line with natural justice, the authorities/regulators do intervene frequently. This is classic case where I believe that consumers are being put at a disadvantage. As a popular forum with a decent following, can this not be taken up to atleast bring to the attention of RBI? Can even an attempt not be made to stop this BS by the banks. How long should paying customers promised of services be at the mercy of the banks and leave all work and keep track of what was applicable on a card one day to the next and chase after new cards that suit us, and then the next card after this particular one gets devalues and lose the fee paid in the process.
Sorry for the rant, but this has been going on for way too long now and is very frustrating.

 

[6ix9ine]

Sorry, but I view this 'rant' as a positive response. It's not just you, everyone on the forums and outside of them feels the same way. It's just some people face the issue and align with it, while others, like you seek a resolution, which I truly appreciate and everyone should do the same.

Coming to the thread, in my opinion, the best-case scenario would be to make such changes with the start of the financial year (April). Instead of devaluing in the middle of the year, they should implement these changes at the start of the financial year and notify everyone at least six months in advance. This would give a chance to those who have spent a good amount for getting a credit card.

Just like yesterday's RBI circular on NBFC banks (regarding no penalty on premature withdrawal of FDs etc), there should be a similar rule for credit cards. If you have taken a credit card from a bank, you should have the option to request its permanent closure within three months and you will be fully reimbursed, but only under the condition of devaluation.

If you request closure without an official devaluation, your fees should not be reimbursed. This would help prevent misuse.

I believe @TechnoFino is the best person to address this issue, as he has a large audience on X.

 

[Zacobite]

I think with the recent trend of credit card devaluations and almost all banks falling over each other to devalue their cards, we as consumers have just accepted it as a reality and move on, moving from one card to another.
My issue is, when we sign up for any subscription (which effectively credit cards are), we look at what we are getting against the subscription price and based on that we decide whether to purchase the subscription or not. Now, if we have paid an annual fee upfront for a set of features and services, we expect to receive those services for the year/subscription period. Minor changes are acceptable but if the key features are taken away, what is the point of what we paid for. I understand that the TnC already mention that the bank may change the offerings at any time and we all have agreed to those terms, but is that acceptable? One solution could be that a bank should be able to effect changes in a card only at renewal, not in between. So the changes will not come into effect together for all cardholders, but in a phased manner as per the renewals. Another option could be, if major changes are made in the offerings, is it not fair that we should have the option to cancel the card and be entitled to get a refund of the fee on a pro rata basis, for the period used? Or have a monthly fee so that as soon as changes are applicable, if the card is cancelled there is minimum loss. Banks are now launching cards with a lot of features, getting people in and taking the upfront fees and within a few months devalue it, seems like it has become a scam.
I know I may receive some sarcastic responses and people making fun saying thats how things function and since we have agreed to the TnC, nothing can be done about it. Well we sign a lot of TnC but if they are not in line with natural justice, the authorities/regulators do intervene frequently. This is classic case where I believe that consumers are being put at a disadvantage. As a popular forum with a decent following, can this not be taken up to atleast bring to the attention of RBI? Can even an attempt not be made to stop this BS by the banks. How long should paying customers promised of services be at the mercy of the banks and leave all work and keep track of what was applicable on a card one day to the next and chase after new cards that suit us, and then the next card after this particular one gets devalues and lose the fee paid in the process.
Sorry for the rant, but this has been going on for way too long now and is very frustrating.

its especially true for paid fee cards.. LTF maube not.. at some point all of us stop using most cards and end up with 2-3 main cards for specific purposes.. i remember @SSV saying.. put them. in a drawer and shut them.. over time..

 

[HumorSimpson]

@Vasuki @VISHESH_BANSAL @D₹V

 

[abhishek0882]

its especially true for paid fee cards.. LTF maube not.. at some point all of us stop using most cards and end up with 2-3 main cards for specific purposes.. i remember @SSV saying.. put them. in a drawer and shut them.. over time..

Yes, LTF is fine, one can put it in a drawer and shut them and forget about it. But when you have paid your hard earned money for M&G, lounge access, airport transfers, free movie tickets and for rewards at a particular rate, and then the bank go back on their commitment and don't even have to refund/compensate you, it feels completely unjustified. If the rewards and services promised are unsustainable, they shouldn't have been offered in the first place, because one pays based on that. They can't say, it's too expensive for us, so we will discontinue it and what fee YOU paid covers OUR misjudgement. It is like you get a great deal on a hotel tariff online and paid and booked a hotel room online. You reach there and find that the hotel has given away the room to someone who was paying more for it and on top of that they also do not refund what you had already paid. Whatever TnC you may have agreed to, will this be fair? Or will you be okay if the hotel gives you an alternate accommodation at a much lower rated hotel if thats what the TnC says? If its not acceptable in that case how can it be justified in the case of credit cards where they are essentially doing the same thing.

 

[abhishek0882]

Sorry, but I view this 'rant' as a positive response. It's not just you, everyone on the forums and outside of them feels the same way. It's just some people face the issue and align with it, while others, like you seek a resolution, which I truly appreciate and everyone should do the same.

Coming to the thread, in my opinion, the best-case scenario would be to make such changes with the start of the financial year (April). Instead of devaluing in the middle of the year, they should implement these changes at the start of the financial year and notify everyone at least six months in advance. This would give a chance to those who have spent a good amount for getting a credit card.

Just like yesterday's RBI circular on NBFC banks (regarding no penalty on premature withdrawal of FDs etc), there should be a similar rule for credit cards. If you have taken a credit card from a bank, you should have the option to request its permanent closure within three months and you will be fully reimbursed, but only under the condition of devaluation.

If you request closure without an official devaluation, your fees should not be reimbursed. This would help prevent misuse.

I believe @TechnoFino is the best person to address this issue, as he has a large audience on X.

These are good suggestions. And yes, @TechnoFino and all the leading lights on this forum who have a good following across social media platforms could take this up, will help the community immensely. I am up for signing any petitions if thats the way forward.

 

[Zacobite]

Yes, LTF is fine, one can put it in a drawer and shut them and forget about it. But when you have paid your hard earned money for M&G, lounge access, airport transfers, free movie tickets and for rewards at a particular rate, and then the bank go back on their commitment and don't even have to refund/compensate you, it feels completely unjustified. If the rewards and services promised are unsustainable, they shouldn't have been offered in the first place, because one pays based on that. They can't say, it's too expensive for us, so we will discontinue it and what fee YOU paid covers OUR misjudgement. It is like you get a great deal on a hotel tariff online and paid and booked a hotel room online. You reach there and find that the hotel has given away the room to someone who was paying more for it and on top of that they also do not refund what you had already paid. Whatever TnC you may have agreed to, will this be fair? Or will you be okay if the hotel gives you an alternate accommodation at a much lower rated hotel if thats what the TnC says? If its not acceptable in that case how can it be justified in the case of credit cards where they are essentially doing the same thing.

I agreed with you mate "its especially true for paid fee cards"

 

[card-shard]

See, the whole rewards & cashbacks are given to make people develop habit of using credit cards.
Remember that credit card adoption in India is single digits only as per population numbers, and almost all of that has happened post COVID.
Pre-COVID credit card penetration was <2% ONLY.

India's economic boom is overshadowed by a surprisingly low credit card penetration rate – only 3.4% as of March 2023 (RBI)

Companies burn money to give high rewards & benefits, and after onboarding enough customers all companies will cut down on the freebies.
It's typical story of any startup these days. Give free delivery, instant delivery, high discounts to get customer, then slowly cut down all these freebies.
Card companies generally get 1-3% commission from our spends, how do you think companies can afford to give 5-10% cashbacks?? THINK.

It's not sustainable for companies to earn max 3% and give 5-10% in most cases.
The music will stop sooner or later. That's the truth.

Long term high rate reward is only possible in high-end hotels/luxury restaurants/business class travel, as these are already run on high profit margins.

 

[abhishek0882]

I agreed with you mate "its especially true for paid fee cards"

I know......... I agreed that it doesn't matter as much for LTF cards. After that what I wrote was not particularly in response to you, the emotions just flowed

 

[Zacobite]

I know......... I agreed that it doesn't matter as much for LTF cards. After that what I wrote was not particularly in response to you, the emotions just flowed

let it flowwwww...

 

[HumorSimpson]

The music will stop sooner or later. That's the truth.

And we don't get any chair.

 

[Zacobite]

See, the whole rewards & cashbacks are given to make people develop habit of using credit cards.
Remember that credit card adoption in India is single digits only as per population numbers, and almost all of that has happened post COVID.
Pre-COVID credit card penetration was <2% ONLY.

India's economic boom is overshadowed by a surprisingly low credit card penetration rate – only 3.4% as of March 2023 (RBI)

Companies burn money to give high rewards & benefits, and after onboarding enough customers all companies will cut down on the freebies.
It's typical story of any startup these days. Give free delivery, instant delivery, high discounts to get customer, then slowly cut down all these freebies.
Card companies generally get 1-3% commission from our spends, how do you think companies can afford to give 5-10% cashbacks?? THINK.

It's not sustainable for companies to earn max 3% and give 5-10%.
The music will stop sooner or later. That's the truth.

music has slowed down... usage slowdown will also follow... just hope ppl don't fall into debt in this euphoria.. the domino effect will be huge and is predicted by rbi.. hence they are also hawkish on credit cards

 

[abhishek0882]

See, the whole rewards & cashbacks are given to make people develop habit of using credit cards.
Remember that credit card adoption in India is single digits only as per population numbers, and almost all of that has happened post COVID.
Pre-COVID credit card penetration was <2% ONLY.

India's economic boom is overshadowed by a surprisingly low credit card penetration rate – only 3.4% as of March 2023 (RBI)

Companies burn money to give high rewards & benefits, and after onboarding enough customers all companies will cut down on the freebies.
It's typical story of any startup these days. Give free delivery, instant delivery, high discounts to get customer, then slowly cut down all these freebies.
Card companies generally get 1-3% commission from our spends, how do you think companies can afford to give 5-10% cashbacks?? THINK.

It's not sustainable for companies to earn max 3% and give 5-10%.
The music will stop sooner or later. That's the the truth.

I understand that. I am totally fine with cards that do not offer ANY benefits at all and are just a payment tool. But when you charge upfront fees based on the benefits you offer and then go back on the commitment, that is where the problem lies. The problem is going back on the promise made and charging us for the mistake in calculation they made. Of course it is not sustainable, then do not offer it, or offer it till the time you can, but charge only until that point and refund for the remaining period. How many people will go for a paid Magnus now, knowing the fee and the features, that is a conscious call. But when you blind side people, by first charging them for features offered and then taking the money based on that and then withdrawing the features, how is that fair?
If you book a 500sqft suite at a hotel and pay for it, and on reaching there, the hotel says there's no occupancy we will give you our 18sqft standard room and we will not refund you because we are atleast providing you accommodation, is that fair, will you accept? Had the hotel initially quoted you the same proce for their standard room, it would be for you to decide whether you want to take it or not, but after you pay if they change the offering, is that fair? That's what I am talking about.

 

[vaibhav111vaibhav111 is verified member.]

i agree with OP, how this thing will be implemented though that the thing cause bank once achieve their target they will reduce cause they need to make money.. that business..

 

[abhishek0882]

i agree with OP, how this thing will be implemented though that the thing cause bank once achieve their target they will reduce cause they need to make money.. that business..

Of course the banks need to make money and business will always come first. But business has to be done fairly and with ethics. Otherwise business would be run without any rules and anyone could do anything just to earn more profits. In the end, agreements and contracts have to be respected. No problem with the benefits being withdrawn once targets are achieved, but not arbitrarily and without compensating refunding the consumers for what they were promised, signed up for and were not allowed to use.

 

[Vasuki]

I think with the recent trend of credit card devaluations and almost all banks falling over each other to devalue their cards, we as consumers have just accepted it as a reality and move on, moving from one card to another.
My issue is, when we sign up for any subscription (which effectively credit cards are), we look at what we are getting against the subscription price and based on that we decide whether to purchase the subscription or not. Now, if we have paid an annual fee upfront for a set of features and services, we expect to receive those services for the year/subscription period. Minor changes are acceptable but if the key features are taken away, what is the point of what we paid for. I understand that the TnC already mention that the bank may change the offerings at any time and we all have agreed to those terms, but is that acceptable? One solution could be that a bank should be able to effect changes in a card only at renewal, not in between. So the changes will not come into effect together for all cardholders, but in a phased manner as per the renewals. Another option could be, if major changes are made in the offerings, is it not fair that we should have the option to cancel the card and be entitled to get a refund of the fee on a pro rata basis, for the period used? Or have a monthly fee so that as soon as changes are applicable, if the card is cancelled there is minimum loss. Banks are now launching cards with a lot of features, getting people in and taking the upfront fees and within a few months devalue it, seems like it has become a scam.
I know I may receive some sarcastic responses and people making fun saying thats how things function and since we have agreed to the TnC, nothing can be done about it. Well we sign a lot of TnC but if they are not in line with natural justice, the authorities/regulators do intervene frequently. This is classic case where I believe that consumers are being put at a disadvantage. As a popular forum with a decent following, can this not be taken up to atleast bring to the attention of RBI? Can even an attempt not be made to stop this BS by the banks. How long should paying customers promised of services be at the mercy of the banks and leave all work and keep track of what was applicable on a card one day to the next and chase after new cards that suit us, and then the next card after this particular one gets devalues and lose the fee paid in the process.
Sorry for the rant, but this has been going on for way too long now and is very frustrating.

It's war time buddy gear it up to buy bonds,unless dungeons of battle galaxia is no mood to fight anymore

MasterCard just announced 3% job cut worldwide
Unless we surpass 5k dollar GDp per capita,we ain't buying luxury with cc and banks are not for charity

 

[card-shard]

I understand that. I am totally fine with cards that do not offer ANY benefits at all and are just a payment tool. But when you charge upfront fees based on the benefits you offer and then go back on the commitment, that is where the problem lies. The problem is going back on the promise made and charging us for the mistake in calculation they made. Of course it is not sustainable, then do not offer it, or offer it till the time you can, but charge only until that point and refund for the remaining period. How many people will go for a paid Magnus now, knowing the fee and the features, that is a conscious call. But when you blind side people, by first charging them for features offered and then taking the money based on that and then withdrawing the features, how is that fair?
If you book a 500sqft suite at a hotel and pay for it, and on reaching there, the hotel says there's no occupancy we will give you our 18sqft standard room and we will not refund you because we are atleast providing you accommodation, is that fair, will you accept? Had the hotel initially quoted you the same proce for their standard room, it would be for you to decide whether you want to take it or not, but after you pay if they change the offering, is that fair? That's what I am talking about.

You've valid concern for paid cards, assuming you can't meet the fee waiver criteria.
There has been shared stories on this forum that people have compained about devaluation to nodal officers and got partial/full refund of the fees, and then they close the card. Plz try that route.

I personally don't believe in this strategy of taking paid cards and having to compute rewards to recover fees. Either I take LTF cards or cards where my usual spends can cross the waiver criteria.
(People who take paid cards without having expenses to meet fee waiver will be hit hardest from devaluations I believe.)

 

[abhishek0882]

It's war time buddy gear it up to buy bonds,unless dungeons of battle galaxia is no mood to fight anymore

MasterCard just announced 3% job cut worldwide
Unless we surpass 5k dollar GDp per capita,we ain't buying luxury with cc and banks are not for charity

So tomorrow the banks can deny withdrawal of my deposits because there are wars and economic crises and we are a third world country with low GDP per capita???? Because they are not there for charity, they get to keep my deposits? Because as I see it, the cc fee I paid was a price for services that were not delivered to me, so I should either get a refund or get the promised services. If you have got a prepaid recharge of your phone from Airtel, will you accept if they say tomorrow that they will stop their services to you despite you having the balance because they are not here for charity but to do business?? Does that make any sense? Can they say that they will not provide services because of the GDP per capita or war or economic crises? Maybe I am dumb, but I cannot make any sense of these logic and the defence given for the banks. If you do not pay the EMI on your loan to the bank, because of global scenario, economy, recession, layoff, gdp - will the bank agree? Are you doing charity by repaying the loan to the bank? You are keeping a promise you made to the bank, and that is what it is about.

 

[TheGuy]

Good thread @abhishek0882 . I echo the sentiments.

@card-shard I will try refund of fees with nodal if devaluation happens on paid card, thanks for the tip.

 

[TheGuy]

So tomorrow the banks can deny withdrawal of my deposits because there are wars and economic crises and we are a third world country with low GDP per capita???? Because they are not there for charity, they get to keep my deposits? Because as I see it, the cc fee I paid was a price for services that were not delivered to me, so I should either get a refund or get the promised services. If you have got a prepaid recharge of your phone from Airtel, will you accept if they say tomorrow that they will stop their services to you despite you having the balance because they are not here for charity but to do business?? Does that make any sense? Can they say that they will not provide services because of the GDP per capita or war or economic crises? Maybe I am dumb, but I cannot make any sense of these logic and the defence given for the banks. If you do not pay the EMI on your loan to the bank, because of global scenario, economy, recession, layoff, gdp - will the bank agree? Are you doing charity by repaying the loan to the bank? You are keeping a promise you made to the bank, and that is what it is about.

yeah, that was some bs.

ETA: India is currently at peace. If we go to war then war economics comes into play. Your bonds will be useless. GSecs will give 20%.