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Military Families Get VIP Treatment from Credit Card Issuers

[Thursday, October 24th, 2013]

The people who protect Americans by serving in the armed forces are getting some protection themselves, from an unexpected source: big banks and credit card issuers. Many credit cards offer special terms for members of the military and their families, making it easier for them to manage financially while putting their safety on the line for the sake of national security.

In response to the unique challenges of military service, American Express, Bank of America and Capital One all offer modified terms and conditions for military personnel. The Servicemembers Civil Relief Act (SCRA) dictates that banks charge no more than 6% on loans to military families and requires them to waive certain fees, but these banks are going above and beyond the SCRA to ease the financial burden on service members even further.

New service members often do not receive their first paychecks for up to two months after joining up. When they do get paid, the first payment is by check, not direct deposit. For someone on active duty, getting to the bank can be difficult or even dangerous. Also, military families must move frequently, having to pay for things like relocation fees, new furniture and rent deposits.

To ease that burden, banks have put the following policies in place:

  • American Express offers fee waivers, so active duty militarypersonnel can avoid late payment fees, overlimit fees and annual fees. All cardholders need to do is contact AmericanExpress customer care and explain that they are active duty military. They will need to supply credentials to American Express, but after that process is approved, all fees will be waived from that date forward, and fees already paid will even be refunded.
  • Bank of America waives all credit card fees including balance transfer fees, foreign transaction fees, late payment fees, annual fees, fees charged for statement copies, and fees for overdraft protection. Once they have verified that the armed service member is on active duty, all fees are waived, including retroactively.
  • Capital One waives all the same fees that American Express and Bank of America do, but they also offer a special rate on loans. All loans are capped at 4% for eligible military families. The SCRA requires a 6% cap. The length of the loan interest limit is also extended—Capital One gives the 4% rate for a full year, rather than the 180 days required by law.

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