Some members of the $522 million National Institutes of Health Federal Credit Union have been told the interest rates going forward on their NIHFCU branded credit cards are going up.
The credit union sold its credit card portfolio to Elan Financial Services, a subsidiary of U.S. Bancorp, in September 2009. Members received letters indicating that their previously fixed interest rate cards would become variable rate, but rates overall did not increase.
But the latest letters, dated Jan. 27 and which carried neither Elan's nor the credit union's names, said the rates would remain variable but would now be significantly higher. In one example, the rate climbed from 9.75% to 16.99% on any card balances added after Feb. 22 of this year. Balances on the card before Feb. 22 would remain at the old rate. "[O]ur decision was made on the level of profitability on the Account," several letters said. An 800 number on the letter got Elan's cardholder services where members were told nothing could be done about the rate hike.
Continue Reading for Free
Register and gain access to:
- Breaking credit union news and analysis, on-site and via our newsletters and custom alerts
- Weekly Shared Accounts podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the commercial real estate and financial advisory markets on our other ALM sites, GlobeSt.com and ThinkAdvisor.com
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.