Follow-up interest confuses bread customers
Private label credit card companies (PLCCs) have a lot to do as retail sales and Buy Now, Pay Later (BNPL) players push installment loans for longer. Mercator expects the PLCC market to decline slightly in 2023, while branded network credit cards will increase slightly. The difference between PLCC and in-network credit cards is the connection to retail merchants, who will have a tough 2023 as the economy boils. Where does the trailing interest come from?
The bread was before the problem with a AAA-Visa co-brand. With 61 million members, the AAA card has a tremendous following for a credit card co-brand. The beginning, however, is difficult. Columbus-based NBC News reports on a question of bizarre interest to consumers.
- Several customers with a specific credit card have questions about a certain charge that welcomes them in October, and he has ties to a Central Ohio company.
- Google Trends showed a big spike Thursday morning of people searching for answers about “bread tracking activity” in Columbus.
- They reported seeing a charge with the memo “Bread trailing activity” on their AAA credit card statement. Several people said they spotted the charge after receiving replacement cards on October 9, when AAA recently changed financial partners from Bank of America.
Here is the real problem. Bread resumed the partnership with Bank of America. As the card converted trailing interest, for carried forward balances, it stood out when it was labeled “trailing interest”. The charges may be correct, although the conversion could have been easier if the customers had been informed in advance.
Interest calculations and disclosures are more important than ever as the CFPB has declared a potentially new area of interest. We cover the subject in depth in this recent Mercator point of view.
Preview by Brian RileyDirector, Credit Advisory Services at Groupe Conseil Mercator.