New Credit Card, Same as the Old Credit Card? Skip to main content

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New Credit Card, Same as the Old Credit Card?


This week, Citigroup will launch a brand, spanking new credit card that purportedly carries with a trifecta of post-recessionary perks: no late fees, no penalty rates and a single interest rate for purchases, balance transfers and cash advances.

As reported by The Associated Press, Citi’s revamped “Simplicity card” sells itself as exactly that: it will be marketed to those who are “juggling busy schedules” and “want a credit card with simple terms.” In fact, Jud Linville, CEO of Citi Cards told the AP, "It lets them not have to worry that they're going to be late on a payment. It provides some flexibility.”

But amid Citi’s claims that their new card is somehow different than the plastic that has placed so many an American budget in financial jeopardy over the past several years, there are many reasons to think twice before sending in an application for their Simplicity.

According to the AP, “One of the biggest drawbacks is the card's 16.99 percent interest rate. That's higher than the average rate on the market of 14.40 percent last week, according to, which tracks financial data. So if you're prompt with payments but tend to carry a balance, a low interest rate is likely a bigger priority than the perks offered by Citi's new card. The Simplicity card also doesn't offer any rewards, which can be a deal breaker for some. Or it may turn out you won't qualify for the card. Citi declined to specify what type of credit background is required. But, which lets consumers search and compare card offers, lists the Simplicity card for those with ‘excellent’ scores of 720 or higher.”

Despite these potential downsides, Citigroup is banking on the fact that this no-fuss card will attract many folks who are willing to pay a higher interest rate for features that have traditionally been hard to come by. According to, “less than 5 percent of cards don't charge a late fee. Only 8 percent charge a single interest rate for purchases, balance transfers and cash advances. Thirty percent of cards don't charge a penalty interest rate, but the figure is skewed because affinity cards, such as those issued by universities, do not have penalty rates.”

In fact, the Simplicity card, with its added features and no-fuss billing, is a result of a new regulatory environment, getting rid of “gotcha” fees, like hikes in interest or punitive penalties, and targeting consumers seeking simpler, more transparent terms.

But despite the perks that come with this new Simplicity card, it’s important to remember that any consumer credit—with its customary interest rates—inevitably means paying more and potentially digging a new financial hole for your family.

In most cases, financial experts agree, men and women trying to get back on their financial feet should instead avoid credit card harm and get a head start on that new flush future by starting to save now, using cash for purchases, and avoiding expenditures at all when using cash isn’t an option.

And remember, if you’re already drowning in credit card debt, knowing a qualified bankruptcy attorney can help you face many of your financial fears, yielding the right kinds of support, information and insights—at a low cost— for a viable and secure future beyond all of the things selling Simplicity this season.

The bankruptcy professionals at the Law Offices of John T. Orcutt offer a totally FREE debt consultation and now, more than ever, it’s time to take them up on their offer. Just call toll free to +1-919-646-2654, or make an appointment online at


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