Credit card annual fees

Once a year, my credit card statements will reflect something which I dread - the annual fee. To clarify, I don't dread paying, because everyone knows that you can always request for a waiver. What I detest is having to call the bank up and navigate through their automated phone labyrinth before I can get through, and it wastes a lot of time. 

So I wonder - why do banks still ask customers to pay annual fees? How many of us actually pay annual fees, for one thing? Most people would simply call the bank up to request (or is it demand?) for a waiver. If the bank refuses, we cancel the card - there are so many cards out there that one card less wouldn't make a difference.

To me, the annual fee is somewhat like a lose-lose situation. To the customer, he loses because he either pays the fee, or wastes time and effort to request for the waiver. To the bank, assuming that the majority of people would not pay, it loses because it needs to waste precious resources for their call centres to answer such calls. Just imagine - if this annual fee did not exist - more resources can be diverted to handle other customer issues, like enquiry of their products and services or other matters. 

So why do the banks still charge them? Maybe it's to give the customer the impression that their card is more prestigious, thus justifying the fee. And when the bank agrees to waive the fee, it generates goodwill. (But I doubt if there is any goodwill generated now since it's the norm to waive fees.) Or maybe the bank hopes that some of their customers will overlook the fee and pay it accidentally. Or perhaps there is a minority that couldn't be bothered about the fee (or too busy to call and waive) and just pay up. Another possibility is that they force customers to call them up, and meanwhile they may take the chance to cross-sell other banking products.

To me, as I mentioned earlier, what I dread most is to call up the banks and get thrown into a maze, where it takes skillful navigation and patience before you can reach your destination. It irks me too when they take the opportunity to promote some of their products to you before giving you the phone options, when all you want is to settle your business as soon as possible without listening to any additional crappy advertising.

So far, the best experience I have had is with HSBC Bank. If you were to call their hotline, the first option given to you is to press '2#1' if you are calling to request for a credit card fee waiver. It is definitely refreshing not having to plunge into their phone jungle and bash your way through thick bushes and trees before getting what you want.

But the best method is just to eliminate it entirely. It saves the customer time (and money), and it frees up bank call centre resources. And compared to the current situation, it certainly looks like a win-win situation.