In a bid to counteract the new stringent banking regulations that could eat into a major portion of its profits, Citigroup is laying groundwork for imposing annual fees on credit card holders – reported Wall Street Journal.
It has been reported that the new credit card laws, which are expected to be implemented from February 2010, aim to restrict fluctuating interest rates and fees, and provide credit card users with more information about their debts.
Against this backdrop, card lenders are looking for opportunities to find a way to cope with the soaring losses arising from crdit card loan defaults. Card lenders are making changes in interest rates and fees, offering various reward programs, reducing credit lines and closing accounts, reported the Daily Mail.
Samuel Wang, spokesman at Citigroup, said: We have adjusted pricing and card terms for some customers as part of our regular account reviews. These changes also reflect the dramatically higher cost of doing business in our industry as we work to preserve the broad availability of credit. As part of this change in terms, a small number of Citi customers may be notified of an annual fee.
