JPMorgan raises credit card fee
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NEW YORK - JPMorgan Chase & Co. is raising some balance-transfer fees on credit cards to 5 percent, the highest among the nation’s largest banks, citing increasing regulations and costs after the United States put new curbs on the industry.
The lender starts charging more in August, just as the law to curb interest-rate increases, fees, and marketing practices begins to take effect.
The credit card law President Obama signed May 22 prompted warnings from industry executives that they’d be forced to raise fees, curtail credit, and restrict consumer rewards programs. Congress heard testimony yesterday on Obama’s proposed Consumer Financial Protection Agency, which would have authority over increases like the boost JPMorgan is planning, said the chairman of the House Financial Services Committee, Barney Frank.
“What Chase is doing is strengthening the argument for the new entity,’’ Frank, a Massachusetts Democrat, said yesterday before the hearing. Banks should be able to impose fees to cover their costs, not to create a “new profit center,’’ he said.
JPMorgan’s previous average fee for balance transfers was 3 percent, spokesman Paul Hartwick said. He declined to say how many customers will be affected. The increase also applies to cash advances, and fixed interest rates will become variable, the notice said. JPMorgan may choose to offer a lower transfer fee, the notice said; Hartwick declined to elaborate.
“In the current economic environment, our costs of doing business have been impacted by increased losses,’’ Hartwick said in an e-mail. “We are increasing balance-transfer fees to reflect the increasing costs.’’
