Most credit cards in the UK at least (same cap) have no standard account fee. Those that do come with other perks / beyond the 'world elite' etc side Mastercard/visa aren't seeing that money - its going to the issuing bank. Bank accounts also generaly have no standard fees (and a lot of other things we take forgranted - faster payments (if I send money to a friend/business I can do it instantly for free without needing a third party solution), standing orders, direct debit etc. - that make banking far easier than in the US).
There is also regulation in place that restricts predatory fee practices, getting customers into revolving debt and protection that makes card issuers liable for purchases (Section 75 - e.g. if I order something paying with my credit card and the merchant doesn't pay, the card issuer is legally liable / I can claim from them and its on them to get it from the merchant)
My understanding is that cashback cards of the type we have everywhere in the US (e.g. Amazon Amex = 5% back on Amazon purchases, Wells Fargo Active Cash = 2% back on everything) don't exist elsewhere.
Another example: I just earned $1000 from Chase Sapphire as a new customer bonus for diverting $5K of the spending I would do elsewhere on that card over three months.
That's just your bank giving back some (but not all) of those 2+% interchange fees.
Basically, in EU you have low fees, so credit cards are boring, they offer almost zero perks (because there's no money to finance those). No one really cares about what brand of card they get, only about their credit limit. In the US you are charged high fees on every purchase, and then the bank uses your own money to bribe you, or encourage particular types of (excessive) spending, or just make you addicted to credit card debt.
I have been using US credit cards for years, all over Europe, taking advantage of points/rewards/car rental insurance/money back on challenged purchases, and I pay no more than the Europeans with their debit cards, be it services or products. And I pay the entire balance once a month, from a HYSA US account, thus making a little interest on that part, also, rather than debiting at the time of each purchase, from my non interest bearing European account
>That's just your bank giving back some (but not all) of those 2% interchange fees.
On the contrary, for someone like me who pays off my balances each month, if I get 2% back for every transaction, I am breaking even on those fees if assuming that I pay 100% of the fees, which of course isn't true; the merchant pays some of that. So really, I come out slightly ahead.
For something like the Amex I mentioned with its 5% back on Amazon, I am coming out well ahead.
> and then the bank uses your own money to bribe you, or encourage particular types of (excessive) spending, or just make you addicted to credit card debt.
Oh, good grief. So EU credit card companies don't do this? I had no idea they offered cards purely as a charitable venture.
I love how you stacked up all those sins just on the US side. Keep this sort of /r/AmericaBad nonsense out of HN.
That's a card with a $800 annual fee... And the Amazon Amex requires a Prime membership, so you are paying at least $140/year for that card.
Credit card companies aren't stupid, they offer a few loss leaders but they make it annoying and time-consuming to come out ahead. And most of the big perks are one-time only, they have gotten much better at banning "churners".
Not my Sapphire. $95. Undecided on whether to keep it or change to another type (I'm not a churner, so 5/24 is not relevant). Also undecided on whether to keep the 100,000 points sitting in the rewards balance for the time being, or cash it out to the aforementioned $1000 now.
I was really surprised that it was normal to have account fees in the US. In the UK banking is free, at least until you hit an overdraft charge. They even made Bank ATMs fee free whatever bank you are with around 2000 (non bank ATMs still have a charge.)
Other than Amex for airline points I don’t spend a penny on banking, all the standard services (eg transfers, bill payments, cash withdrawals, deposits) are free (in the U.K.) with no monthly fee.
Most credit cards in the UK at least (same cap) have no standard account fee. Those that do come with other perks / beyond the 'world elite' etc side Mastercard/visa aren't seeing that money - its going to the issuing bank. Bank accounts also generaly have no standard fees (and a lot of other things we take forgranted - faster payments (if I send money to a friend/business I can do it instantly for free without needing a third party solution), standing orders, direct debit etc. - that make banking far easier than in the US).
There is also regulation in place that restricts predatory fee practices, getting customers into revolving debt and protection that makes card issuers liable for purchases (Section 75 - e.g. if I order something paying with my credit card and the merchant doesn't pay, the card issuer is legally liable / I can claim from them and its on them to get it from the merchant)
>Is there information on EU vs US credit limits?
I would be very interested in this as well.
My understanding is that cashback cards of the type we have everywhere in the US (e.g. Amazon Amex = 5% back on Amazon purchases, Wells Fargo Active Cash = 2% back on everything) don't exist elsewhere.
Another example: I just earned $1000 from Chase Sapphire as a new customer bonus for diverting $5K of the spending I would do elsewhere on that card over three months.
That's just your bank giving back some (but not all) of those 2+% interchange fees.
Basically, in EU you have low fees, so credit cards are boring, they offer almost zero perks (because there's no money to finance those). No one really cares about what brand of card they get, only about their credit limit. In the US you are charged high fees on every purchase, and then the bank uses your own money to bribe you, or encourage particular types of (excessive) spending, or just make you addicted to credit card debt.
I have been using US credit cards for years, all over Europe, taking advantage of points/rewards/car rental insurance/money back on challenged purchases, and I pay no more than the Europeans with their debit cards, be it services or products. And I pay the entire balance once a month, from a HYSA US account, thus making a little interest on that part, also, rather than debiting at the time of each purchase, from my non interest bearing European account
>That's just your bank giving back some (but not all) of those 2% interchange fees.
On the contrary, for someone like me who pays off my balances each month, if I get 2% back for every transaction, I am breaking even on those fees if assuming that I pay 100% of the fees, which of course isn't true; the merchant pays some of that. So really, I come out slightly ahead.
For something like the Amex I mentioned with its 5% back on Amazon, I am coming out well ahead.
> and then the bank uses your own money to bribe you, or encourage particular types of (excessive) spending, or just make you addicted to credit card debt.
Oh, good grief. So EU credit card companies don't do this? I had no idea they offered cards purely as a charitable venture.
I love how you stacked up all those sins just on the US side. Keep this sort of /r/AmericaBad nonsense out of HN.
8 replies →
That's a card with a $800 annual fee... And the Amazon Amex requires a Prime membership, so you are paying at least $140/year for that card.
Credit card companies aren't stupid, they offer a few loss leaders but they make it annoying and time-consuming to come out ahead. And most of the big perks are one-time only, they have gotten much better at banning "churners".
> That's a card with a $800 annual fee
Not my Sapphire. $95. Undecided on whether to keep it or change to another type (I'm not a churner, so 5/24 is not relevant). Also undecided on whether to keep the 100,000 points sitting in the rewards balance for the time being, or cash it out to the aforementioned $1000 now.
1 reply →
I was really surprised that it was normal to have account fees in the US. In the UK banking is free, at least until you hit an overdraft charge. They even made Bank ATMs fee free whatever bank you are with around 2000 (non bank ATMs still have a charge.)
If you pick the right bank, you can get the same deal in the US.
Actually, you can get no fees at any ATM
schwab has no fees at any atm globally :)
Other than Amex for airline points I don’t spend a penny on banking, all the standard services (eg transfers, bill payments, cash withdrawals, deposits) are free (in the U.K.) with no monthly fee.
I pay 3€ per month to "Nordea" for "unlimited" accounts and one VISA debit card.
My banks pays me more than that per month to use their debit cards.
So are you the product at your bank or why would they pay you to use their services?
4 replies →