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Wachovia Reenters Credit Card Market with Promise of Fewer Penalties, Generous Rewards

by Peter Andrew

Wachovia

Reenters Credit Card Market with Promise of Fewer Penalties,

Generous Rewards

Wachovia Corp. is set to return as a major credit card issuer

next week, and the company is promising lower rates, fewer penalties

and generous rewards to compete for space in consumers' wallets.

Among the perks: automatic waivers of one late fee and one over-limit

fee each year, the combining of credit and debit transactions

in one rewards program, and the promise of less aggressive repricing

for accounts that have minor breaches of the cards' terms and

conditions.

Wachovia

will offer three new credit card products--Wachovia Classic,

Wachovia Platinum and Wachovia Signature.

Wachovia

is attempting to position its new offerings as more consumer-friendly

than other issuers' cards, some of which have received bad press

for aggressively penalizing cardholders for relatively minor

infractions. Complaints from consumers have included late fees

for payments that arrive on the due date but after the time-of-day

deadline and interest rates that drastically increase after

a single late card payment, or even for late payments on bills

completely unrelated to the credit card itself. Wachovia says

it will not reprice an interest rate unless a customer has two

consecutive payments past due three times or three consecutive

payments past due in a 12-month-period.

Wachovia's

Possibilities Rewards program sounds relatively unique for most

cardholders. It allows cardholders to choose between debit and

credit card transactions, while still receiving all the reward

points in a single account.

Wachovia

chose to re-enter the credit card issuing market after its previous

partner, MBNA, was acquired by Bank of America. MBNA had been

issuing Wachovia-branded credit cards since 2000. Bank of America

will continue to own the customers who signed up for those cards,

but Wachovia hopes that they will have the desire to stick with

the brand they put their initial trust in and will thus choose

one of Wachovia's new offerings.

Published 07/27/06 (Modified 05/07/12)


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