Citi Adds $60 Annual Fee to Many Cards – Watch Your Mailbox

If you have a credit card from Citibank, keep an eye on your mailbox because Citi has recently implemented a $60 annual fee for many of their cards. Citibank – the same too-big-to-fail monstrosity – the same company that accepted taxpayer bailout money and subsequently jacked up interest rates across the board – yeah, that company. Not content with the cash they’ve already wrung from the taxpayers, they have now tacked on this $60 fee to many cards that previously had no annual fee. However, Citi will generously refund the $60 if you spend $2,400 per year on the card. Wow, thanks for nothing, Citi.

Thanks to a reader named Bill for pointing this out to me. Several different cards are apparently affected, including:

  • Citi AT&T Universal Card
  • Citi Diamond Preferred Rewards Mastercard
  • Citi Dividend World Mastercard
  • Citi Dividend AMEX Card
  • Citi Drivers Edge Card
  • Citi Home Rebate Mastercard
  • Citi mtvU Student Card
  • Citi Platinum Select Mastercard

There may be others as well, so be sure not to throw away any junk mail from Citi without reading it carefully. I have four credit cards from Citibank, though the only one mentioned in this list is the mtvU. So far, I have not yet received a letter, but we’ll see if it arrives in the mail anytime soon. I’ll be sure to update this post if it does.

Citi’s addition of this annual fee is a bid to do two things:

  1. Get people to use the cards more often, thereby generating more revenue for Citi.
  2. Squeeze even more cash from the taxpayers who saved their butts in 2008.

You can read about more people’s experiences on this Sickdeals thread and this Fatwallet thread. Here is a scan of a letter from Citi, compliments of the user unsmart3d on SD:

My favorite part:

The reason we are making this change is to maintain the quality of our service amid the rising cost of doing business.

Cough, cough… BS! Wow, they’re really laying it on thick and heavy. Anyway, I don’t mean to give Citi too hard a time. After all, it’s perfectly within their rights to impose an annual fee on all of their cards if they want. They can choose to do business that way. No one is forcing us to use Citi credit cards… and as consumers, it’s within our rights to call and cancel our accounts if we receive one of these letters! We can choose to take our business elsewhere.

That’s exactly what I intend to do if one of these letters graces my mailbox. If you have received one, I’d love to hear your thoughts and what you’ve chosen to do.

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62 thoughts on “Citi Adds $60 Annual Fee to Many Cards – Watch Your Mailbox

  1. Can I still cacel after March 31 without having to get stuck with the $60. I missed the original letter and didn’t find out until I got the bill. I’ve had my card since 1986.

  2. Hello,
    I am a reporter with the Wall Street Journal and I’m working on an article about credit card billing practices. As part of the article, I am looking to interview any cardholder who was hit with the $60 annual fee. If you are willing to share your story, please contact me at (212) 416-2665 or via email at jessica.silver-greenberg@wsj.com

    Thank you!
    Jessica

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  5. Imagine what this likely does to someone unaware of the membership fee change, thinks their balance is $0 and will remain so, their account is inactive and thus clear and safe. It’s a likely 200 FICO score hit. One hell of a revenge from Citi for not using their card.

    I had a balance of $0 since late 2009. Hadn’t used the card in over a year; years prior was easily posting $15,000 a year on the card. Had gotten in the habit of using another card, so thought there was no harm in keeping the Citi account active, as there’s no annual fee right?

    In fact, I don’t have an active physical credit card (you can do this by never activating a new card that is sent, in my case my old card expired and they sent me a new one, you still have a live account since your card/account # though is still valid). Only used their Virtual Account Numbers, which expire within 2 months (so having not created one, within 3 months there’s nothing that can be on a statement if the earlier statements are clear). I did this for 4+ years (last physical credit card used was with an expiration in 2005), but used Virtual Account Numbers (va#) for online purchases (last created a va# toward the end of 2009).

    So no physical card for someone to use, no fraud possible since there is no valid expiration date for the issued unactivated card, and no active va#s…so no reason to check in on the account. Citi does not send statements if there is no activity on the account and the statement balance is $0. Heck, I checked my online account for 5-6 months after I last used a va# anyways and there were no statements as no balance was carried. So I stopped doing even that.

    Which was, you guessed it, Feb 2010. (Talk about coincidence–I’m such a loser.) Plus, if something happens, I’ll be mailed a statement, right? As it stands, $0 balance and no purchases means a status quo of no monthly statement from Citi.

    Citi makes the annual fee change. For some reason, I received no mail about the $60 change. Which they charged me 2 months later. So I should receive a statement right? Didn’t. And having stopped checking my online account since, well, I wasn’t using the account, I don’t see the activity there. And I’m thinking all is good, no statement, that’s the status quo. Should receive a phone call? They claimed they called 4 times–and they admit they never spoke with me in person and and always got a machine (how convenient for them).

    So my no balance became a balance because of a membership fee they implement on a no annual fee card. They even start charging interest on the membership fee. Goes 4 months unpaid (that’s probably 90to120+ day late payment report FICO hit), and I imagine the “courteous refund” of the $60 and $2.07 in interest when they closed the account off is really probably being reported as a charge off (which would be another FICO hit).

    The result–someone who hasn’t made a purchase probably results in a -200 FICO score.

    I learned of this today. When I logged into create a va# for a purchase. Oh happy new year.

    Wonderful world we live in where not actually having money lended to you, where you made no puchase, no buy, can result in such a huge detrimental hit to your credit score.

    And if this banking slant isn’t enough, this also goes to show how screwed up FICO is, where a $62 charge created and CAUSED by the lender is the near equivalent of filing a bankruptcy by the lendee.

  6. Those fees are just unreal. I am an American living in Singapore. I only have the card as a backup. I seldom use it. I was just paying the yearly fee when the invoice comes in my email. Last November I discovered that my card had expired in 2011. Honestly, if I never activated the card, then it stands to reason that I never received it. Furthermore it stands to reason that if I do not have the card, there is little reason to keep asking for the annual fee!

    I asked them to close the account for lack of interest, and they credited me the last $50. I made sure they have my correct address.

    Should I see a refund of the $50 sometime soon?

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