I don’t how much the positive PR is worth, or how much additional costs do they eliminate by renouncing to recover anything. But arguments of the “losing money is good for companies because they recover a small part of it as tax savings” kind do not make a lot of sense in general.
Couldn't find it in the article anywhere.
Chase announced they were closing these accounts in April 2018, and tried to have them closed by March 2018.
The reason was that Chase was getting out of it's relationship with J.P. Morgan.
It's now over a year later, and due to contractual obligations can't legally force people to pay their full balances all at once.
Other than continuing their relationship with J.P Morgan until all cardholders payed off their balances in full, this was the only other option.
Huh? They're the same company, "JPMorgan Chase & Co."
If they write off this debt, they probably also get to claim a deduction somewhere on money that they would never be able to collect.
(At one point, one of these ilk of companies offered my grandfather the "privilege" of taking a lump sum settlement for his black lung payments. I calculated what principal I expected they needed to reserve to provide his payments, discounted it slightly and hoped that they wanted rid of the accounting and maintenance in order to give him the lump sum. Alas, they weren't desperate enough to get him off the books and we never heard from them again.)
They can certainly take a deduction for some money they wouldn't be able to collect successfully. But they can deduct the entire balance now, rather than writing off small portions over the next so many years. Of course, they're simply not getting taxed on money they didn't earn (since it's a deduction, not a credit).
The mathematically optimal solution is certainly not to write everything off. They could have sold it to a debt collection company and made a larger profit.
I wonder did it affect my credit rating, but where I am, credit ratings really aren't all that important compared to the US (and reset over a few years anyway).