(Financial) Breakups are Not Great...

in #steemleo2 months ago



Relationships in financial services are said to be some of the strongest bonds created by companies and their customers; at least historically. The amount of innovation and disruption across technology has already started to shift the thinking of many customers towards value oriented services rather than just branding. I have always tried to create brand loyalty in my financial service products for years as I always have believed that it generates a goodwill going both ways. I have had bank accounts as well as credit cards with some institutions for over 10 years in many cases.

However, I have started to see many practices of jumping between companies and services to take advantages of the best deals. I see many articles and videos on loyalty reward farming or balance transfers to take advantages of bonus programs and interest rate differences. I have always stayed far from these moves as I think that the administrative burden to make these changes are really not worth the effort for its benefits. Also, given the "Know Your Customer" (KYC) requirements in the sector and how they have increased, I am uncomfortable with too many financial institutions to have too much information about me.

I just had a surprising experience that has made me reconsider my approach to actually look towards also taking advantage of these competitive and technological forces in the future. A couple of months ago, I was the victim of identity theft and despite having a monitoring service that immediately notified me of some activity and me acting within hours, I was stuck with a fraudulent account that evolved into a collection account on my credit report. This unexpectedly impacted my credit score despite my quick actions of notification and "resolving" the issue.

Unfortunately, the resolution was not fast enough for the algorithms of one of my credit card companies which immediately cancelled my accounts due to the low credit score. Although I had not been actively using these accounts, the economic conditions always warrant to have access to funds at any time which made me concerned. Despite being a customer for over 10 years and having accounts with great experience, they proceeded with the cancellation despite my call to deter the account being closed.

I immediately cancelled my deposit accounts and to my surprise, got much better terms and conditions at a competitor. Where I have been trying to build goodwill, it seems that institutions are no longer pursuing these longer term relationship. I feel this is a secondary impact of the DeFi movement which are more open and free to move about. I am just a number for most of these companies so why not treat them the same, right? My thought of how far Blockchain and Decentralization can go in money and finance continues to grow and I am encouraged to be part of that path forward.

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I have experienced similar kneejerk reactions to stolen cards being charged to the limit and droppping my credit score, then card companies jacking up my rates and lowering my credit limits. As you probably know, having your limits lowered increases the percentage of credit used, which in turn lowers your credit score. I was able to break out of this self perpetuating cycle, but it was frustrating and left me feeling like their was no bank customer loyalty left in the world. So I move my balances at the slightest discount and bigger and better deal. I keep the cards to lower my percentage credit used and to count towards paid on time accounts.

Good Luck

That is exactly why it has been so frustrating at this point. Luckily, I am slowly finding myself without the need for short term credit so I hope to one day completely break free with no debt and savings to handle emergencies and expenditures. It is still a little nerve-wracking given the circumstances we are all currently in to have this happen. Definitely will look to use them to my advantage going forward.

@newageinv, Financial Relationships are very critical Subject in this World.

Have a Productive time ahead and stay blessed.

I would bail on one of my cards if I could pay the damn thing off any time soon. My wife and I were, and still do, pay on our bill each and every month on time. The single time we were not able to make ends meet I called and explained our situation. I simply asked to be able to pay them in a few days as opposed to one day (payday was in two days) and after year...YEARS of loyalty they flat out denied my request and stated that we will be charged a fee if out the payment was late.

Lucky for us we received the last-minute windfall we needed and were able to pay the bill. But I will not forget that unkindness they shown.

Agree, that is why I focused on paying them all down as soon as I could. Had some great success a couple of years ago with some business and it help me pay them all off. I have been able to steer clear of them for almost 10 years now so it has helped but it sure bothers me they care so little of a relationship of so many years.