Consumer complaint received 2020-04-30
Company: BANK OF AMERICA, NATIONAL ASSOCIATION
State: UT
Product: Credit card or prepaid card
Sub-product: General-purpose credit card or charge card
Issue: Fees or interest
Sub-issue: Charged too much interest

Complaint:
In short, I believe Bank of America intentionally uses counter-intuitive nomenclature for their automatic payment options which leads many cardholders to receive irreversible interest charges. Here is my experience : Immediately after receiving my new Bank of America Premium Rewards credit card, I logged into online banking and set up automatic payments from an external payment account. This is my practice with all credit card accounts I open ( 3-4 yearly ). 

When setting up automatic payment preferences, the payment options displayed via online and mobile banking are : - Amount Due - Minimum Amount Due - Account Balance - Fixed Amount These are payment options I am familiar with and have seen with basically all of the other issuers I bank with. I ran into trouble because the definitions of the payment options are unclear, and I believe intentionally so. Almost all other issuers I've opened accounts with have a very similar set of payment options, but with ubiquitous definitions. Here 's what I mean. 
- Amount Due Other Issuers : Last Statement Balance BoA : Every bill has an amount due. " Some bills, such as credit cards, will have additional options for paying what's due. Selecting this option may leave a balance due. Not paying the full amount due could result in fees or finance charges. '' - Minimum Amount Due Other Issuers : Minimum Amount Due ( $ 20-30, or 1 % -3 % of current balance ) BoA : " For some bills, such as credit cards, you can pay a minimum amount of the total due. However, selecting this option may leave a balance due. Not paying the full amount due could result in fees or finance charges. '' - Account Balance Other Issuers : Current balance when payment is initiated ( usually more than last statement balance ) BoA : " For some bills, such as credit cards, you can pay the total amount due. Selecting this option helps you avoid any fees or finance charges resulting from not paying the total balance. '' I include these definitions because I think they present the issue very clearly. There's even circular logic in the definition for " Account Balance '' ; part of the " Account Balance '' definition is " total amount due '' ... doesn't that sound really similar to " Amount Due ''? I hope you're smiling. If my intention is to pay the full amount due, wouldn't I intuitively choose the payment option for " Amount Due ''? That seems more intuitive than " Account Balance ''. I actually suspect that in the Cardholder Agreement, " Balance '' is defined as the amount you currently owe. So, I would assume that the " Account Balance '' payment option means the payment would be in the amount I currently owe, not the amount I owed on my last statement. 

So, in a nutshell, I am a well-educated consumer with lots of experience with credit cards. I made a very reasonable assumption with the info presented that " Amount Due '' was the automatic payment option that means the amount I need to pay to avoid interest. If I made this mistake, I bet a whole lot of other people have made this mistake. 

Today I noticed my first payment was for {$35.00} on a balance over {$2000.00}. So whatever BoA 's secret sauce calculation for " Amount Due '' is, the amount of the payment is what I would have expected for a minimum payment. Clearly it would take a LONG time to repay my balance and a lot of interest paid if I failed to take action and just let the " Amount Due '' setting persist. Because I didn't pay the full previous statement balance, I was charged a {$70.00} interest fee, which BoA will not refund. I made my case to a BoA service agent over the phone this morning. The call lasted 27 minutes and the agent refused to refund my interest fee as a one-time courtesy. She also refused to escalate my request. This was my first payment ( and obviously my first interest fee ). 

Consumers should not have to dig into fine print when the plain language they're reading seems straight forward.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with monetary relief