WASHINGTON—Credit card cash advance fees are up, while cash-based bonuses are down, according to CardHub’s Q2 Credit Card Landscape Report.
Following a 40% run-up over the past three years, the value of credit card initial rewards bonuses experienced a slight correction during Q2 2015, with cash-based bonuses dropping 5.09% and their point/mile counterparts falling 2.84%, CardHub reported.
“Issuers seem to be focused on attracting new customers who have existing debt, while slowly steering away from people intent on incurring new debt in a recovering economy,” said CardHub in a release. “This conclusion is supported by the fact that 0% balance transfer periods have stabilized, while 0% purchase terms are becoming shorter. Transferred balances figure to be increasingly profitable for issuers in a rising interest rate environment, especially since they give financial institutions added lending firepower.”
Credit card companies continue to exploit the weakness of cash-hungry customers, increasing cash advance fees by roughly 60% since the end of 2010. The average cash advance fee is now above 3.98%, or $14.08, the study found.
Rates held fairly stable during the second quarter, with notable exceptions being APRs for people with fair credit (which rose 3.61%) as well as those for people with excellent credit (which fell 1.47%).
Consumer complaints regarding “advertising and marketing” as well as “rewards” have skyrocketed in 2015, rising roughly 180% and 169%, respectively, CardHub said.