By way of a post on the Payments Views blog, The Era of Responsible Credit Card Borrowing Begins Today, I heard that Chase recently launched a new Blueprint service for their credit cards.
In a nutshell, Blueprint is a fancy suggested payment calculator. For customers who carry a balance, Blueprint lets them set up some rules and helps them calculate how much they should pay based on those rules.
In an ideal world, nobody carries a balance on their credit cards and everybody always pays in full. Because we are not in an ideal world, Blueprint has its place.
There are four major features in Chase Blueprint:
Full Pay. Customers can designate charges in any of 14 “everyday” categories as Full Pay. Blueprint will include all new charges in those categories in the suggested payment amount.
A benefit of declaring Full Pay is that these Full Pay charges receive a grace period. Normally when the customer carries a balance, there is no grace period: all new charges accrue interest right away. With Full Pay, the credit card works like a deferred debit card for the Full Pay charges. This grace period privilege will be removed if the customer fails to honor the full pay pledge in three out of any six months.
The 14 “everyday” categories are:
- Department Stores and Catalog
- Gas and Convenience Stores
- Grocery Stores
- Health clubs and Membership
- Laundry and Dry Cleaning
- Office and School Supplies
- Salon and Beauty Supplies
- Wholesale Clubs and Discount Stores
- All blink Purchases (blink is the swipeless RFID technology embeded in some cards)
Split. For larger purchases, customers can select the number of payments to pay it off or select a fixed monthly payment amount. Blueprint will include it in the suggested payment amount.
Finish It. For existing balance, customers can also select the number of payments to pay it off or select a fixed monthly payment amount. Blueprint will include it in the suggested payment amount.
Track It. This one has nothing to do with suggested payment calculation. It lets customers enter a spending target by category and see how they are doing against those targets.
The Blueprint suggested payment is just a suggestion. The cardholder is still only obligated to pay the minimum payment. The account statement shows both the minimum payment and the Blueprint Payment.
The account statement also marks the “full pay” charges with a special icon and includes separate sections for Full Pay, Split, Finish It, and Track It.
I can see Chase made substantial investment in creating these features. Full Pay encourages customers to pay for everyday purchases in full instead of adding to their debt. Split It and Finish It help customers set a target date for when the purchases will be paid off in full, instead of just letting the customers make the minimum payment. For customers who carry a balance, these are very helpful tools.
Blueprint does not apply to cardholders who always pay the card balance in full. For these cardholders, Chase offers automatic payment which debits a bank account for the full statement balance on the due date. I’ve been using it for a long time. No late fee, no finance charge, guaranteed.
The automatic payment feature from Chase is very easy to set up. You can set it up online (for my two other cards from American Express and FIA Card Services, I had to call the card company for a paper form). It’s also smart. If the statement balance is $500 and a $50 refund comes in before the due date, Chase will automatically adjust the bank debit from $500 to $450.
Chase has not added Blueprint Payment in its automatic payments options. It should.