Credit-card (and other) companies would love it if consumers received their monthly statements electronically only. It's cheaper. But, according to a a new report from the National Consumer Law Center — entitled Paper Statements: An Important Consumer Protection— policy makers (and consumers) should resist the pressure to move to an electronic-only world. Here's an excerpt from the Center's press release:
The report notes that millions of Americans — particularly lower-income, less educated, older, and households of color — are on the other side of the “digital divide,” lacking home broadband Internet access. According to a recent Pew Research study:
* 59% of households with incomes under $20,000 and 53% of those with less than a high school education do not have home broadband Internet access. Even those with access may have older computers, slow connection speeds, or may lack a printer or money to afford expensive ink to print statements.
* About half of Hispanics (50%) and African Americans (46%) lack access to home broadband Internet.
* Over half (55%) of Americans 65 years or older lack home broadband Internet. Even if they have access, older consumers may be less comfortable with electronic statements or find them risky. Paper statements can be critical for family members who are trying to piece together financial records for an older consumer who is incapacitated or has passed away.
Even computer-savvy consumers may prefer paper as electronic statements are easy to overlook due to email overload. Consumers may value a physical mail piece as a record-keeping tool and reminder to pay. The report cites studies showing that consumers prefer paper when a payment is due upon receipt, and warns that electronic statements might cause consumers to miss payments.
So, NCLC says that credit-card companies and banks should be prohibited from
- making electronic statements the default choice;
- compelling consumers to consent to electronic statements by making it a condition of a product or condition of web access; or
- charging a fee for paper statements that are required by federal law.
Check out this infographic: