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Where Knowledge Junkies Get Their Fix
I found this map on Pennylicious (a terrific blog about money). It’s a really interesting look at where the top 10 credit card issuers are chartered – states with the weakest limits on interest rates. 5 of the states don’t even have limits. And even if you live in a state that has a strict limit on interest rates, if the bank you use is not based in that state, the limit does not affect that company. National banks only have to follow the limits of the state in which they are chartered. Sneaky!
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In The Magazine
And why do you suppose those states have weak or non-existent caps? Why to lure banks to locate there. I happen to live in Sunny South Dakota, which is home to Citibank and many other bank card companies. The banking laws are formulated to draw banks to the state, which brings jobs.
I have vague recollections of when the state legislature went to great lengths to rewrite the banking laws to create a business climate that would tempt Citibank to locate in our fair state. Citibank was the first of many to locate here, and is still one of the largest employers in the state. In any industry.
So it’s not necessarily the banks that are being sneaky… Which came first, the chicken or the egg?
posted by Dave on 9-19-2006 at 5:22 pm
Good point, Dave. And while I still think credit card companies mislead consumers with all their tiny print on their applications, I also see why a state would try to lure banks to locate within their borders. Thanks for your reply.
posted by Will on 9-19-2006 at 11:12 pm
I agree with you, Will, on the fineprint argument. You won’t catch me defending credit card company practices; I use mine only when necessary and pay it off monthly. Can’t remember the last time I paid any interest or fees on the card. I only wish many others did the same. But if that happened,
I worked for the Citibank monster while in college, and was grateful for the experience and the benefits (tuition included!) but even more grateful for the lessons learned from all the poor sods that shouldn’t have been given the cards in the first place. It’s really pitiful the holes that some people dig for themselves abusing plastic.
posted by Dave on 9-20-2006 at 12:24 pm