JPMorgan Raises Monthly Minimum Payments on Credit Cards to 5%

Nice move by JPMorgan just before restrictive rules come into effect. Just another reason to only use credit cards for emergencies.-Lou

JPMorgan Raises Monthly Minimum Payments on Credit Cards to 5%

June 30 (Bloomberg) -- JPMorgan Chase & Co., the biggest U.S. credit-card issuer, plans to raise the monthly minimum payment on balances to 5 percent less than a month before new federal curbs on rates and marketing practices take effect.

The increase from 2 percent starts in August, Chase said in a notice received by customers in June. Customers who pay less than the minimum may be charged extra fees, the bank’s Web site says. New York-based JPMorgan has about 159 million cards in circulation, a regulatory filing shows.

The increase is at least the second disclosed by JPMorgan, which told consumers this month that balance-transfer fees will rise to 5 percent. Card companies have said a law signed May 22 by President

Barack Obama to restrict interest-rate increases and penalties will push up fees, curtail credit and restrict rewards. The law was aimed at practices that advocates and a MasterCard Inc. executive called “unfair” and “deceptive.”

The new minimum affects “select accounts that have carried balances,” according to JPMorgan spokeswoman

Stephanie Jacobson. “The way customers use and maintain an account helps us determine what changes to make in order to protect our customers and our company,” Jacobson said in an e-mailed statement.

The Credit Card Accountability Responsibility and

Disclosure Act requires that consumers receive 45 days’ notice of “significant” contract changes, including rate increases, as of Aug. 20.
Chase confirmed earlier this month its balance-transfer fee on credit cards will rise in August to 5 percent from 3 percent. The bank cited “new federal regulations” in a notice to cardholders.

JPMorgan Chief Executive Officer Jamie Dimon said May 27 the card business was the “most challenged” and the new rules could cost the bank about $500 million. The unit lost $547 million in the first quarter.