08-28-2018, 06:15 PM
.......as it is.....they make it hard to get approved for a card.....now randomly closing accounts for those that take advantage or rewards programs....
Credit-card super users are searching for answers amid a string of shutdowns from Chase, as billions in costs on lavish rewards pile up
Members of online communities of credit-card super users have been freaking out over the past year after hearing stories from some JPMorgan Chase cardholders that the bank shut down their credit-card accounts.
•Since the credit-card rewards arms race ramped up a couple of years ago following the Chase Sapphire Reserve launch, credit-card enthusiasts who make a hobby of accumulating points for free travel and other perks have swelled in numbers.
•Like card sharks in a casino, these customers tend to be very savvy, know all the rules and angles, and can eat away at a bank's credit-card profits.
•Chase has gained widespread attention for its lavish rewards program, but profitability in its card division has fallen as it spends billions on rising rewards costs.
•The shutdown cases are anecdotal, but they suggest that Chase may be taking a harder line with credit-card gamers who open too many accounts.
....Two years ago this month, JPMorgan Chase unleashed an industry-rattling new product: the Sapphire Reserve, a premium travel reward credit card with an eye-popping 100,000-point sign-up offer and innovative travel perks.
Chase quickly amassed hordes of excited customers, despite forgoing traditional marketing and relying on word of mouth. It eclipsed its one-year sales target in the first two weeks, despite a hefty $450 annual fee. It temporarily ran out of the card's signature metal core.
The viral reaction to the Sapphire Reserve's launch caught the attention of rival card companies competing for a slice of the industry's $183 billion in fees and interest. Copycat efforts were launched over the following year to keep pace with Chase's juggernaut, taking to new heights an already expensive and years-long battle to attract credit-card customers by hurling juicy rewards perks at them.
"In the aftermath of the Chase Sapphire Reserve, I think that signaled a kind of arms race in the rewards space," said Brian Kelly, the founder and CEO of the ThePointsGuy.com, one of the most popular and long-running sites for travel-rewards enthusiasts.
Chase, thanks to the Reserve and a number of other new cards that it's launched in the past year, has succeeded in luring millions of new customers. Yet the rewards arms race and the new clientele the bank has attracted have taken a toll. JPMorgan's card income has fallen by 25% in the past two years amid soaring rewards expenses.
Top JPMorgan executives maintain that the significant investments in attracting all these new customers — especially the Sapphire Reserve cardholders, who skew young and wealthy — will pay off in the long run.
Chase hasn't sat idle, though, taking measures to trim costs. It cut the sign-up bonus of the Sapphire Reserve in half, to 50,000 points in January 2017, less than six months after the card launched.
This May, leaked documents revealed Chase was cutting back on other credit-card benefits, such as Priority Pass lounge access and price protection, changes that took effect this week.
And over the past year, some credit-card super users have grown anxious that Chase might be targeting them for cuts too.
The ranks of these super users, who try to maximize card perks while minimizing the interest and fees they pay card issuers, have swelled in recent years, fed by a cottage industry of sites, services, and online communities that have popped up to help them stay on top of the smartest ways to earn and redeem points.
Alarming stories started appearing online in forums and blogs frequented by the users. Customers with no obvious credit black marks or rules violations were suddenly having their card accounts shut down by Chase.
Chase declined to comment specifically on the shutdown incidents cited by customers or whether it had targeted certain types of behavior to root out, but said the company gears its products toward long-term customers.
"We want to build lifelong relationships with our customers. We know our engaged, long-term customers are more satisfied and we design our products with this in mind," a company spokeswoman said in a statement.
On Reddit, FlyerTalk, Doctor of Credit, and other venues for rewards junkies, stories of account shutdowns started to pile up over the past year, as did warnings to apply for new Chase cards with caution.
Even on The Points Guy, a community for more mainstream credit-card users, readers were cautioned in a post from May that "recent reader reports indicate that applying for too many Chase cards too quickly can lead to account scrutiny and complete Chase shutdowns."
"Looks like Chase is seriously cracking down," Reddit user Morphogencc also wrote in May. "I recently tried to use my Sapphire reserve card and it didn't work. I was a bit surprised and checked my online account — and all my accounts were closed."
Morphogencc, who said in the post that they hadn't applied for any cards in months, was fortunate. They called Chase to appeal and the shutdown was reversed, though they told Business Insider that Chase never gave them a formal reason for why they were reinstated.
Others haven't been as lucky. On a blog called Travel In Points, another Chase super user, who goes by the Reddit handle SJ0, gave a detailed blow-by-blow of having his accounts shut down in December after a nearly 10-year relationship with the bank. His shutdown was final.
"It's really weird. There is no set rule," SJ0, who declined to use his full name, told Business Insider.
Was the game up?
'This is terrifying'
Doctor of Credit, a popular site for credit-card enthusiasts founded six years ago, started to notice something different around May 2017. The site's senior contributor and editor, who goes only by his first name, Chuck, saw an uptick in Chase cardholders discussing account shutdowns, usually in connection to having several recent credit inquiries or card openings.
"The bottom line is that there's a new animal in the room," he wrote.
One the most prominent gathering places for super users to report and discuss the issue is on the Reddit forum r/churning, a subreddit with 135,000 subscribers dedicated to maximizing credit-card points, especially through sign-up bonuses.
Churning, or opening a card and collecting the bonus before ditching it, is frowned upon by credit-card issuers because it costs them money in loyalty rewards given to people who don't demonstrate loyalty. The churning community on Reddit is a particularly ardent and sophisticated subset of credit-card super users.
But toward the end of last year, enough of these stories were cropping up in the forum's daily discussion threads that the subreddit's moderators created a "megathread" in December dedicated to collating and analyzing the "rash of shutdown reports" in granular detail. (Reddit threads are archived after six months, so a second megathread on Chase shutdowns was started in June.)
To suss out what was happening, moderators asked Redditers posting shutdown reports to include personal info like how many credit cards they'd opened and when, their FICO scores, credit use, spending behavior, any derogatory credit history, and stated explanation for their account closures.
Among the users in this group, Chase commonly cited too many recent credit inquiries, too much extended credit, or too many open accounts as reasons for closing their accounts. Most cardholders said they called Chase to appeal; some said they succeeded in getting Chase to reinstate their accounts, while for others the decision was final.
The vagueness of "too many" and "too much" was perplexing and foreboding to the community. Many credit-card enthusiasts could meet those definitions — and could have for years — depending on where the line was drawn.
It wasn't clear what precisely was triggering the shutdowns, nor the rationale behind who got reinstated. One user with 40 new credit cards opened in the past two years — 10 with Chase — said they got their shutdown reversed; another user with 10 credit cards total — none opened in the past year and a half — and a more than decade-long Chase credit-card relationship said Chase refused to reinstate the two cards it shut down.
According to Chase's rewards program user agreement, cardholders can lose points or immediately have their points revoked if Chase closes the account because it suspects misuse of the rewards program "by repeatedly opening or otherwise maintaining credit-card accounts for the purpose of generating rewards." It doesn't lay out the criteria for determining such misuse.
But in general, these cardholders were told they had 30 days to use their points after being shut down, and misusing the rewards program wasn't cited as a reason for the shutdown. Was there another reason at play? A sign that Chase was finally targeting the savviest users as they eat away at profitability?
"Well s--- ... this is terrifying. I don't know what else to say," the thread's moderator commented on a shutdown report from July that Redditers struggled to make sense of.
Some churners weren't convinced Chase had them in their sights, but to many, the implication of the growing number of shutdowns was clear: If Chase was targeting churners, the rewards party could be coming to an end............
what a dumb thing to do...........?!
Credit-card super users are searching for answers amid a string of shutdowns from Chase, as billions in costs on lavish rewards pile up
Members of online communities of credit-card super users have been freaking out over the past year after hearing stories from some JPMorgan Chase cardholders that the bank shut down their credit-card accounts.
•Since the credit-card rewards arms race ramped up a couple of years ago following the Chase Sapphire Reserve launch, credit-card enthusiasts who make a hobby of accumulating points for free travel and other perks have swelled in numbers.
•Like card sharks in a casino, these customers tend to be very savvy, know all the rules and angles, and can eat away at a bank's credit-card profits.
•Chase has gained widespread attention for its lavish rewards program, but profitability in its card division has fallen as it spends billions on rising rewards costs.
•The shutdown cases are anecdotal, but they suggest that Chase may be taking a harder line with credit-card gamers who open too many accounts.
....Two years ago this month, JPMorgan Chase unleashed an industry-rattling new product: the Sapphire Reserve, a premium travel reward credit card with an eye-popping 100,000-point sign-up offer and innovative travel perks.
Chase quickly amassed hordes of excited customers, despite forgoing traditional marketing and relying on word of mouth. It eclipsed its one-year sales target in the first two weeks, despite a hefty $450 annual fee. It temporarily ran out of the card's signature metal core.
The viral reaction to the Sapphire Reserve's launch caught the attention of rival card companies competing for a slice of the industry's $183 billion in fees and interest. Copycat efforts were launched over the following year to keep pace with Chase's juggernaut, taking to new heights an already expensive and years-long battle to attract credit-card customers by hurling juicy rewards perks at them.
"In the aftermath of the Chase Sapphire Reserve, I think that signaled a kind of arms race in the rewards space," said Brian Kelly, the founder and CEO of the ThePointsGuy.com, one of the most popular and long-running sites for travel-rewards enthusiasts.
Chase, thanks to the Reserve and a number of other new cards that it's launched in the past year, has succeeded in luring millions of new customers. Yet the rewards arms race and the new clientele the bank has attracted have taken a toll. JPMorgan's card income has fallen by 25% in the past two years amid soaring rewards expenses.
Top JPMorgan executives maintain that the significant investments in attracting all these new customers — especially the Sapphire Reserve cardholders, who skew young and wealthy — will pay off in the long run.
Chase hasn't sat idle, though, taking measures to trim costs. It cut the sign-up bonus of the Sapphire Reserve in half, to 50,000 points in January 2017, less than six months after the card launched.
This May, leaked documents revealed Chase was cutting back on other credit-card benefits, such as Priority Pass lounge access and price protection, changes that took effect this week.
And over the past year, some credit-card super users have grown anxious that Chase might be targeting them for cuts too.
The ranks of these super users, who try to maximize card perks while minimizing the interest and fees they pay card issuers, have swelled in recent years, fed by a cottage industry of sites, services, and online communities that have popped up to help them stay on top of the smartest ways to earn and redeem points.
Alarming stories started appearing online in forums and blogs frequented by the users. Customers with no obvious credit black marks or rules violations were suddenly having their card accounts shut down by Chase.
Chase declined to comment specifically on the shutdown incidents cited by customers or whether it had targeted certain types of behavior to root out, but said the company gears its products toward long-term customers.
"We want to build lifelong relationships with our customers. We know our engaged, long-term customers are more satisfied and we design our products with this in mind," a company spokeswoman said in a statement.
On Reddit, FlyerTalk, Doctor of Credit, and other venues for rewards junkies, stories of account shutdowns started to pile up over the past year, as did warnings to apply for new Chase cards with caution.
Even on The Points Guy, a community for more mainstream credit-card users, readers were cautioned in a post from May that "recent reader reports indicate that applying for too many Chase cards too quickly can lead to account scrutiny and complete Chase shutdowns."
"Looks like Chase is seriously cracking down," Reddit user Morphogencc also wrote in May. "I recently tried to use my Sapphire reserve card and it didn't work. I was a bit surprised and checked my online account — and all my accounts were closed."
Morphogencc, who said in the post that they hadn't applied for any cards in months, was fortunate. They called Chase to appeal and the shutdown was reversed, though they told Business Insider that Chase never gave them a formal reason for why they were reinstated.
Others haven't been as lucky. On a blog called Travel In Points, another Chase super user, who goes by the Reddit handle SJ0, gave a detailed blow-by-blow of having his accounts shut down in December after a nearly 10-year relationship with the bank. His shutdown was final.
"It's really weird. There is no set rule," SJ0, who declined to use his full name, told Business Insider.
Was the game up?
'This is terrifying'
Doctor of Credit, a popular site for credit-card enthusiasts founded six years ago, started to notice something different around May 2017. The site's senior contributor and editor, who goes only by his first name, Chuck, saw an uptick in Chase cardholders discussing account shutdowns, usually in connection to having several recent credit inquiries or card openings.
"The bottom line is that there's a new animal in the room," he wrote.
One the most prominent gathering places for super users to report and discuss the issue is on the Reddit forum r/churning, a subreddit with 135,000 subscribers dedicated to maximizing credit-card points, especially through sign-up bonuses.
Churning, or opening a card and collecting the bonus before ditching it, is frowned upon by credit-card issuers because it costs them money in loyalty rewards given to people who don't demonstrate loyalty. The churning community on Reddit is a particularly ardent and sophisticated subset of credit-card super users.
But toward the end of last year, enough of these stories were cropping up in the forum's daily discussion threads that the subreddit's moderators created a "megathread" in December dedicated to collating and analyzing the "rash of shutdown reports" in granular detail. (Reddit threads are archived after six months, so a second megathread on Chase shutdowns was started in June.)
To suss out what was happening, moderators asked Redditers posting shutdown reports to include personal info like how many credit cards they'd opened and when, their FICO scores, credit use, spending behavior, any derogatory credit history, and stated explanation for their account closures.
Among the users in this group, Chase commonly cited too many recent credit inquiries, too much extended credit, or too many open accounts as reasons for closing their accounts. Most cardholders said they called Chase to appeal; some said they succeeded in getting Chase to reinstate their accounts, while for others the decision was final.
The vagueness of "too many" and "too much" was perplexing and foreboding to the community. Many credit-card enthusiasts could meet those definitions — and could have for years — depending on where the line was drawn.
It wasn't clear what precisely was triggering the shutdowns, nor the rationale behind who got reinstated. One user with 40 new credit cards opened in the past two years — 10 with Chase — said they got their shutdown reversed; another user with 10 credit cards total — none opened in the past year and a half — and a more than decade-long Chase credit-card relationship said Chase refused to reinstate the two cards it shut down.
According to Chase's rewards program user agreement, cardholders can lose points or immediately have their points revoked if Chase closes the account because it suspects misuse of the rewards program "by repeatedly opening or otherwise maintaining credit-card accounts for the purpose of generating rewards." It doesn't lay out the criteria for determining such misuse.
But in general, these cardholders were told they had 30 days to use their points after being shut down, and misusing the rewards program wasn't cited as a reason for the shutdown. Was there another reason at play? A sign that Chase was finally targeting the savviest users as they eat away at profitability?
"Well s--- ... this is terrifying. I don't know what else to say," the thread's moderator commented on a shutdown report from July that Redditers struggled to make sense of.
Some churners weren't convinced Chase had them in their sights, but to many, the implication of the growing number of shutdowns was clear: If Chase was targeting churners, the rewards party could be coming to an end............
what a dumb thing to do...........?!