Credit Cards Compete by Forgiving Late Fees

Credit Cards Compete by Forgiving Late Fees

Credit card companies are fighting hard for the best customers and now they are competing in a somewhat unusual way: not charging late fees.

A handful of cards are differentiating themselves from other issuers by foregoing the collection of a $35 fee if you are late on your monthly payment. Issuers may also help their customers by not reporting this tardiness on their credit reports.

The Citi Simplicity card was the first credit card to be marketed in this way, and is the most lenient. It offers "peace of mind with no late fees and no penalty rate." Cardholders are not limited to a certain number of late payments.

Discover is now trying to compete with the new "It" card which has no late fee, over-the-limit fee, annual fee or penalty rate. However, Discover only waives the late fee the first time a cardholder is delinquent. Subsequent late payments will result in a $35 fee and show up on your credit report .

"We believe that consumers want something different from a credit card company--something that addresses their specific needs, treats them fairly and gives them what they deserve," said Roger Hochschild, president and chief operating officer at Discover, in a statement.

The Barclaycard Ring card has no annual fee or penalty rate, and gives the cardholder one late payment without a late fee each year.

Capital One® Platinum Prestige Credit Card
View Offer

Capital One® Platinum Prestige Credit Card

Top Features: 0% Intro on Purchases and Balance Transfers until March 2016

Editor Rating:

Chase Slate®
View Offer

Chase Slate®

Top Features: 0% intro APR for 15 months plus no balance transfer fees within the first 60 days

Editor Rating:

Capital One® Quicksilver® Cash Rewards Credit Card
View Offer

Capital One® Quicksilver® Cash Rewards Credit Card

Top Features: 1.5% cash back on all purchases, 0% intro on purchases and balance transfers until September 2015

Editor Rating:

Barclaycard® Ring MasterCard®
View Offer

Barclaycard® Ring MasterCard®

Top Features: Low 8% (V) APR on purchases and balance transfers

Editor Rating:

Capital One® Venture® Rewards Credit Card
View Offer

Capital One® Venture® Rewards Credit Card

Top Features: Unlimited 2x miles on every purchase, every day

Editor Rating: