Advertiser Disclosure Editorial Disclosure

What Types of Credit Card Relief Do Banks Offer?

As the coronavirus pandemic continues to strain America’s finances, more and more lenders are aiding their customers. Most banks already offer a variety of credit card relief programs designed to help cardholders in dangerous financial straits. But what exactly is “credit card relief?” And what are the types of credit card relief you can request from your bank?

What Is Credit Card Relief?

The term “credit card relief” refers to any incidence of a bank providing help to a customer struggling to make their minimum payments. Seeking relief isn’t something cardholders want to do, but in many cases – such as with COVID-19 – it’s something they desperately require.

Types of Credit Card Relief You Can Request

The good news for consumers is that many issuers are willing to provide relief for cardholders suffering due to the COVID-19 pandemic. All cardholders need to do is contact their bank and see what they can offer to help. Here are some of the ways your bank can deliver credit card relief from coronavirus hardships:

Deferred Payments

The first type of credit card relief is something known as a “deferred payment.” Also known as a skipped payment, this relief method provides cardholders with the option of missing one or more payments. This form of relief is commonly called forbearance and is something you typically see with student loans.

During a payment deferral period, cardholders don’t need to pay back the credit card balance due. This process allows them to enjoy breathing space for the period of the deferral. In most cases, however, the balance will still accrue interest, meaning there will be a higher balance to repay in the future.

Many credit card issuers are deferring payments for those directly impacted by the coronavirus pandemic. This option is an excellent choice for those who are feeling the financial pinch due to job loss, a reduction in hours, or other COVID-19 related issues.

Related Article: Updated Coronavirus Credit Card Relief Contact Information

Payment Extensions

Another common relief solution is payment extensions. Payment extensions provide a cardholder with additional time to accomplish one of several goals:

  • Pay their statement balance
  • Reach a spending minimum to earn welcome offers
  • Earn rewards through card purchases

Issuers grant extensions for spending requirements when many of their customers can’t meet the requirements due to unforeseen circumstances. The coronavirus pandemic is one such recent example of this scenario.

Related Article: Chase Welcome Bonus Spending Minimums Automatically Extended

Fee Waivers

Fee waivers are another outlet for credit card relief that banks and lenders have at their disposal. There are a wide variety of fees that come with credit cards, many of which your bank can waive at its discretion. Examples of fee waivers include annual fee waivers, late fee waivers, or eliminating of penalty fees.

During the coronavirus outbreak, some issuers are waiving late fees on request. Two recent examples are SmartHealth waiving their annual fee over the coronavirus, and efforts by Citibank to reduce charges for customers.

Related Article: Citibank Waiving Fees and Payments By Online Request

Change Due Date

Most credit card companies allow cardholders to select their billing due date. This feature can make it easier for account holders to pay their bills, as they can sync up their due date to their payment schedules.

Change Products

Another option for cardholders struggling to afford a steep annual fee is to request a downgrade to a no-annual-fee version of the card. Many co-branded credit cards for hotels and airlines feature an annual fee – and no-annual-fee – version. Switching to the cost-free version may earn fewer points, but it can save you money year-over-year.

Related Article: Airlines Waive Cancellation Fees Due to Coronavirus

The Takeaway

While the coronavirus outbreak is devastating to personal finances, there are steps consumers can take to protect themselves. The first step, however, should always be contacting your issuer to see what types of relief they offer for your situation. It may feel difficult to ask for help, but you aren’t alone. Millions of Americans are struggling financially due to COVID-19 – and providers are ready to help.

About: Cory

Cory is BestCards.com's "Jack of all trades" and resident rewards expert, covering all facets of the points game – especially travel, hotels, and airlines. In addition to credit cards, Cory finds that jogging, cats, and memes are essential parts of a balanced day.