Advanta Closing Down Small Business Credit Card Accounts
Posted by Tim at 05/26/09 03:53 PM

From Consumerist

T-Minus four days to the closing of Advanta accounts to new charges this Saturday, the small business credit card issuer sent an e-mail out to customers explaining the situation and how it will affect them. (Click here to read the letter)

The Wall Street Journal reports that

Small-business owners have been among the most severely hurt by the credit crisis and recession. Banks have pulled back on small-business loans in recent months, forcing company owners to rely more heavily on plastic for many of their expenses. Card issuers are leery of small businesses because of their volatile revenue streams.

Recently we asked Consumers for their Advanta stories. Here is a sample of what people had to say:

Email from Jeannie: 

“I have had a business card with Advanta for many years. I have never been late on a payment and never gone over my credit limit. Last month I received a notice that the interest rate on my card was being increased from 11.99% to 30.99% because they now considered me a higher credit risk.”

Bill from Santa Cruz, CA:
 
“Advanta raised my interest rate to 34% (yes 34 percent!) overnight for no reason. I was forced to take money out of my IRA to pay off the balance. They encouraged me to transfer all my business debt to the card, and they claimed it would continue to be a low 8 % rate. These people are evil and need to be regulated!”
 
Janet from West Rutland, VT
 
“I pay my credit card bills on time, every month, usually more than the minimum payment. I have a card from Advanta for my in-home business. I started with a 7.99% interest. I missed a payment on another card while I was away on business and Advanta increased my rate to 18.9%. In the past month or so, Advanta has increased my rate to a whopping 34%! When I called to inquire why, I was told that they had determined that, even though I paid on time and more than the minimum each month, I am at risk for defaulting! I said,"so, because you think I'm at risk for defaulting, you should raise my rat to ensure that I do!!?" I was told there was "nothing they could do for me.”
 
We would like to hear from other small business owners about how you are being impacted by Advanta shutting its doors or other Credit Card issuers. Tell us your story in the comments section or go to CreditCardReform.org