Credit cards can come with a lot of secondary features. One excellent example is price protection, which lets credit card users get a refund on their credit card purchases should the price of those purchases fall within a certain period of time. Said feature is more common than what most people would expect, but recent occurrences suggest that this might not remain the case for much longer.
Why Is Chase Eliminating Price Protection on Chase Credit Cards?
For proof, look no further than the fact that Chase is removing price protection from one Chase credit card after another. In fact, the credit card issuer has stated its intention to stop offering price protection, which is a huge change from its previous stance on the matter. However, it is important to note that Chase isn’t alone in this regard, seeing as how other credit card issuers are either eliminating their price protection or making their price protection less useful for their customers.
The reason for this is simple. In short, it used to be the case that most people were unaware of the existence of price protection. The exact percentage is unclear, but there have been sources that claim that perhaps 97 percent of credit card users were unaware of the existence of price protection no more than a short while ago. Since people can’t make good use of features that they don’t know about, this meant that said credit card users were a non-issue when it came to price protection.
However, people who knew about the existence of price protection didn’t make that much more use than their ignorant counterparts. Primarily, this was because the process of submitting a claim was both tedious and time-consuming, meaning that it wasn’t something that most people with busy schedules were willing to put up with in spite of the potential benefits for them. As a result, while there was certainly a small segment of very savvy credit card customers who made regular use of price protection, their numbers were so small that their collective impact on the credit card issuers’ profit-making was either negligible or the next thing to being negligible.
Unfortunately for the credit card issuers, that state of things changed in recent times with the launch of services meant to help interested individuals automate the claims process for price protection. Said services are capable of not just filling out the necessary forms but also performing the searches needed to figure out potential opportunities for making use of price protection. Moreover, said services can be rather creative because of modern techniques and technologies, which makes them that much more useful for their users.
As a result, these services produced a huge explosion in the number of claims that were filed. Partly, this was because more people had become aware of the existence of price protection than ever before, and partly, this was because said individuals could make all of the claims that were available to them without having to use up their own precious time and effort. Combined, these two factors ensured that the credit card issuers were hit and hit hard enough that they needed to make a change. After all, refunds have to come out of someone’s pocket, meaning that what was once a profitable policy had become much less so in the modern age.
In this context, Chase’s choice to eliminate price protection is essentially a move on its part to ensure that its credit card business will remain as profitable as it was before. Said credit card issuer is being joined by its counterparts, but its choice stands out because of the sheer length to which it is planning to go. As a result, one can’t help but wonder what will happen next because of the different credit card issuers’ different choices in response to the matter.
Theoretically, it is possible that it will be a non-issue for the most part because most people weren’t even aware of the existence of price protection in the first place. However, that seems improbable, not least because the messages that Chase and other credit card issuers are making it very clear that they are indeed losing something that they used to have. As a result, it is also possible that some credit card users will switch over to the credit card issuers that are taking a less drastic approach than Chase, particularly if they are someone who has been benefiting from the services that prompted the change in the first place.