Why do Americans get WAY better CC deals than us?

MEM62

Why do Americans get WAY better CC deals than us?

It's a larger and more competitive market. It's a different economy. It has different regulatory controls. They have a different pool of service providers. The expectations of the customer are different.

The comparison is pretty much impossible to make as there is insufficient common ground. You can only compare apples with apples.

Ergates

beany_bot wrote: »

But the EU rules only means we, the consumer, get worse deals, Who are they meant to be helping here?

How does a cap in interchange fees mean we get a worse deal *overall*. You're looking at a single aspect of the overall cost of having a card.

Ergates

jim1999 wrote: »

The point is that the EU rules help all consumers.

If credit card companies charge 2% to all the retailers, then the retailers have to add that to the cost of goods to make the money back. Sure, a handful of people will then get cashback cards so that they get that back again, but all of the people who can't or don't get cashback cards then lose out.

On average, we should be better off with the EU system of capping fees, but for those of us (i..e people posting on MSE) who chase up the best deals and take out the products that are most profitable to use (e.g. cashback credit cards) we will lose out.

More importantly, the EU rules give a better deal to the people who most need it - those with less money. The American system gives the biggest rewards to those who are already wealthy, and !!!! the poor. That's the basis of their entire society.

I'll take cheaper credit for people on low income over bigger rewards for those who can afford it any day of the week.

Stephenmac

My opinion is that I don't care about the credit market in the USA. This is the country that broke the banking system. Why you would even ask this beyond me.

dealer_wins

jim1999 wrote: »

The point is that the EU rules help all consumers.

If credit card companies charge 2% to all the retailers, then the retailers have to add that to the cost of goods to make the money back. Sure, a handful of people will then get cashback cards so that they get that back again, but all of the people who can't or don't get cashback cards then lose out.

On average, we should be better off with the EU system of capping fees, but for those of us (i..e people posting on MSE) who chase up the best deals and take out the products that are most profitable to use (e.g. cashback credit cards) we will lose out.

No, the EU make things worse in 99% of things they interfere in!!

Ergates

dealer_wins wrote: »

No, the EU make things worse in 99% of things they interfere in!!

Should be easy to give lots of examples then.

I mean, real examples, not just Daily Mail quotes.

zagubov

Their banking system is much less competitive than ours. I seem to rememeber most banks as being local ones, with little chance to compete on a national scale.

boo_star

zagubov wrote: »

Their banking system is much less competitive than ours. I seem to rememeber most banks as being local ones, with little chance to compete on a national scale.

Not only that but "consumer rights" are basically non-existent over there.

I'd rather have our more robust consumer protection systems than the chance at earning a few quid back but having to deal with a comparative Wild West financial system any day.

chattychappy

All sorts of unintended side effects of well-meaning regulation.

Think of S75. So great - just put £1 on your credit card and get thousands of pounds of "cover" if that bathroom you bought goes wrong. And who pays for it? Effectively it becomes an insurance we are all forced to pay for everytime we use a credit card.

People think it's great that places can't surcharge for taking credit cards. But suddenly you lose the option of getting a discount for cash. And people have lost the option to pay their HMRC tax bill by personal credit card.

I wonder if the USA has all the regulatory stuff about "responsible" lending, £12 caps for late payment fees, a ban on negative payment hierarchy etc. Some of this stuff puts costs on UK CCs, some of takes away the opportunity to make money back - sneakily or otherwise.

As for Brexit, even a "no deal" brexit, I doubt whether regulation will be rolled back. Much of it was home grown/gold plated and it would be a brave government that takes a step which could "plunge the vulnerable into debt misery" or whatever the headline.

System

dealer_wins wrote: »

No, the EU make things worse in 99% of things they interfere in!!

Got your reply ready for post-Brexit :rotfl:

No, the [STRIKE]EU[/STRIKE] English Government make things worse in 99% of things they interfere in!!