How to Avoid Paying your Credit Card’s Annual Fee
One of the most annoying fees that credit card holders have to pay is the annual credit card fee.
This fee is something charged to us year after year after year. Why are we charged this fee in the first place? Simply speaking, it is billed to us just because “we’re using the credit card”.
That sucks, but fortunately, there are ways to end this annual burden. Here are three of the valid ways to waive or totally eliminate the annual credit fee.
As a matter of fact, I’ve tried all three ways below and I’ve never paid any annual fee with my BPI and Citibank credit cards in the last 10 years!
How to get the bank to waive your annual fee? Or how to eliminate this fee completely? Here are the ways.
1. Use a credit card that offers “No Annual Fee” or “Waived Annual Fee”.
These days, several credit card issuers offer credit cards with the benefit of waived annual fee, especially for the first year. Take advantage of these offers.
Of course, we know that this is simply a bait that banks use because they still make a lot of money through credit card finance charges, annual percentage rates (APR), and even penalty fees. Waived annual fees are marketing tactics used by card issuers to entice customers to own and use the card. Still, if you have a need for a credit card, opting for one with waived first year fee could already save you some money.
There are also cards that offer no lifetime annual fees. Yup, no annual fees, forever!
These extraordinary cards are typically used by banks to lure you to switch to the credit card company or to lock you in for life. Of course, there are the same interest and penalty fees charged to you depending on the usage but, at least, with a waived lifetime fee, you won’t be bothered anymore by annual fees — for life.
In the Philippines, some of the credit cards that offer waived lifetime annual fees include:
- Metrobank’s M card
- HSBC’s Premier Mastercard
- Allied Bank’s Travel Club
- BPI e-Credit card
- Security Bank’s e-Secure card
We have another article talking about credit cards in the Philippines with waived or no annual fee. Click the link to find out which credit cards offer that benefit.
2. Request the bank to waive the annual fee.
Not a lot of credit card holders know this, but a simple call or request to waive the card’s annual fee could eliminate this burden. In fact, this is what I’ve used every single year — in the last 10 years — to waive the annual fee of my Bank of the Philippine Islands (BPI) credit card.
Since I got the card from BPI years ago, I’ve NEVER paid any membership or annual fees. Yup, never paid at all. I was able to save thousand of pesos worth of annual fees every year!
The fee, though, still appears every year in my billing statement. But what I do the moment the annual fee is charged to me is I approach the manager of my branch of account or call BPI’s hotline to request for it to be waived.
If you are a member in good standing, the bank typically grants your request. What usually happens is that the annual fee is reimbursed and shown as “advance payment” in the next month’s billing statement.
Not everyone, though, is qualified for the annual fee waiver. I’ve heard that banks typically assess the cardholder’s usage of the card or credit rating or payment history. If you have been remiss in your monthly payments or have been charged cumulative finance charges over the years, there may be a big chance that banks would decline your request.
Still, try to approach the manager or call the bank to negotiate for a waiver of the annual fee. Who knows, they might waive those fees. Worked for me!
3. Inform the bank you’re canceling your card.
Sometimes, threatening the bank that you’re canceling your card and switching to another bank’s credit card could lead them to give you the annual fee waiver. They sometimes yield in an attempt to keep you as customer.
The moment you inform them of your decision to stop using the card, banks would normally volunteer to waive the card’s annual fee. But like in option #2 above, this usually requires that you have good credit standing with the bank.
You can also simply say that one reason you’re contemplating on switching to another credit card company is the latter’s offer of waived annual credit card fee. You can tell them that you’d want to keep your existing credit card but you hope that the company can waive your annual credit card fee.
Sometimes it works!
Now you know some ways to eliminate your annual membership fee burden. Try the steps above because if they work, you’ll be able to save thousands of pesos every year!
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