More and more credit card users are defaulting on their credit card payments to a point where the credit card companies have to use debt collectors to recover what customers owe them.
Though credit card companies make money from late payment fees, perhaps shifting their approach to providing customer service that prevents bad debt could be more profitable. It defeats the purpose to have many credit card users who cannot use their cards because they need debt relief.
Credit card companies should realize that if they coached customers on how to use their credit cards responsibly, they would retain more customers. A steady customer base ensures steady profits.
Below are examples of some tips that credit card providers should give to their customers:
- Credit card is a form of loan
When you take a loan, you will need to repay it or else it will affect your credit rating.
The same thing applies to credit card debt. If you do not make your monthly payments, you will affect your credit rating and this will hinder your chances of gaining access to other credit facilities.
- Don't overuse your card
Though your bank cannot dictate how you use your card, it would be very helpful if they gave you some tips about when to use and when not to use your credit card.
Credit cards are too convenient when it comes to buying things and you will find yourself spending them even for items that cost $5. However, if a customer service attendant at the credit card company had warned you against this, you will find yourself being more cautious about how you use your card.
Purchases that have a small price tag can add up to a huge bill per month and if you are not able to pay, you will need to use debt relief programs to get out of debt.
- Don't max out your card
Having ready credit is exciting. It is very easy for you to go for a shopping spree and max out your card in the process.
You will then be stuck with a card you cannot use, a loan that you need to clear and a bad credit score.
- Credit card does not equal income
You might find yourself starting to compensate for any deficits in your income. This is however a huge mistake because a card is a loan, not income.
If you have more needs than your income can cover, find a way to make more income or cut unnecessary expenses.
Bottom line
Credit cards are great and you should appreciate them as such. As much as there are debt relief services the help can assist you to deal with debt, these companies help after the fact.
It therefore falls to the credit card companies to provide useful financial management information to their customers. Credit card providers will actually find that they are getting more customers to stay as customers appreciate a company that puts service first.
Shared by http://www.nationaldebtrelief.com/
