A Canadian Credit Card company that had previously decided to cease trading, surprised everyone last week be cancelling all the debt on customers card accounts.
They say there is no such thing as a free lunch, but for the customers of Candian credit card firm JP Morgan Chase, that isn't true. There is such a thing as a free lunch. Their credit card provider has written to all its customers and told them not to worry about their remaining balances, its all been cancelled.
The story started back in 2018 when the Credit Card arm of JP Morgan Chace decided to leave the Card market. Since then, customers have had their cards frozen. They haven't been able to make new purchases, but the company has been collecting their minimum monthly repayments as usual.
Last week, however, customers were baffled when they logged into their accounts to find that their balances were now zero. Thinking it was a blip in the system, they called their card customer services and received the great news - their outstanding debt is wiped clean.
One customer told their local news agency that they thought it was a prank, he had had $5600 (approx £3500) of debt cancelled. "It's been a struggle, so news like this is one of those rare financial shocks. It's like a dream where you don't want to wake up". Other customers told of similar stories.
Chase has not revealed how many customer accounts they have wiped of debt, nor have they said how much it had cost them in total. The move is unusual to say the least. This is probably the first time in modern banking that a major lender has just cancelled the debt of their customers on mass. Usually, card providers tend to sell their loan book to other lenders who then collect on the debt.
Could it happen in the UK?
Highly unlikely, but it would be nice. We are not aware of any card provider that is thinking of leaving the industry in the near future. Most of the lenders that have left the industry have tended to be from the payday sector. In all of these cases, the debt has been passed to the administrators for collection. In quite a few instances though, we have seen administrators not pursuing collections.