While consumers seem to welcome the new credit card protections, small businesses seem to be crying hoarse. The most recent credit card regulations that were brought into force by the Congress early this year seems to offer no protection to small businesses whatsoever. Small businesses and companies now have to shell out higher fees with a faster turnaround on due dates for payments.
Credit card companies seem to have tightened the noose around small businesses by charging late fees and thus making money out of small businesses. Misty Seeley, co-owner of Thurm-A-Matic Inc., states that she has had to cancel one of the gas cards since she found the terms and conditions ridiculous. Adding further, she states that the late fees had been hiked to $50 from the existing $29, and payments are due within just two weeks after the arrival of the bill instead of 25 days with the cut off time being 2 pm.
While the Credit Card Act offers protection for consumers, the same does not apply to business credit cards. The consumers are charged $25 as late payment charges in most cases and the bills are being sent three weeks before the due date and the payments are accepted right until 5 in the evening. Credit Card companies are required to give notices in advance before increasing rates on the cards that already exist, while new card holders will not face any increase in interest rates during the first year.
Small businesses are not protected against card rate hikes, whereas consumer card rates have largely remained unaffected since February 2010. According to a survey done recently, which recently surveyed the data of two thousand three hundred small companies, there has been a 30 percent hike in interest rates since January this year. This would compare with a 16 percent hike for consumer cards.
Small companies can use some of the websites to make a comparison of the interest rates and decide on which card would be best suited for them. There are many websites online that do offer information with regard to annual fees, introductory offers etc.
Visa, has offered incentives where business card holders are provided discounts for stay at the La Quinta Inn Hotel, car rentals from Alamo, Staples office supplies, and subscriptions for USA Today. It would be worthwhile to keep a watch on the incentives and shop for the right card instead of staying with the same card. For a card that would have been ideally suited a year and a half ago may not be the right card anymore. Seeley has a word of advice. "Never take your Credit Card for granted. Keep a watch on them".