The head of a major subprime lender told Sioux Falls television viewers that
Consumer Reports acted unfairly when dubbing his company's product the "worst
credit card in America." KELO-TV reporter Angela Kennecke interviewed Miles
Beacom, President and CEO of First Premier Bank, shortly after the consumer
publication made its proclamation. Consumer Reports' editors cited the First
Premier Bank MasterCard for a high annual fee, high interest rates, and a series
of application fees that can eat up more than half of the card's credit limit
upon opening an account.
Beacom remarked that his company must set high rates to remain in the business of offering credit cards to consumers with low credit scores. He also noted that many of the fees cited by Consumer Reports can vary based on current promotions, but that federal regulations require the bank to supply the costs for "worst case scenarios." Even with demand for subprime credit cards declining overall, Beacom revealed that his company still receives 300,000 credit card applications per month while issuing only 40,000 accounts each month.
About the Author
Joe Taylor Jr. is an internal business consultant for a Fortune 500 company, who writes about finance, culture, and design. He holds a Bachelor of Science in Communications from Ithaca College.