I've just recently started working as part of a collections team for a bank, making collections on missing credit card payments and other payments to do with credit cards (over-limit charges, late fees, arrears). Previous to start the job I didn't know all that much about credit cards, I knew my mother had one, or two store based ones with some reward schemes that she paid off the whole balance at the end of every month, only spending 30 or so on. To me that seemed really simple, she had a limit, she knew what she spent she paid it off at the end of every month in case she wanted to use it again and as far as I was concerned this was how credit cards worked.

Turns out not everyone uses them like this, to protect my job I won't mention the bank I currently work for, though they are a big British bank. It would seem the bank in question seems to have many customers that have effectively lived on their cards, some people have credit limits in excess of 15,000 (at the time some of these limits were set 1=$2 so $30,000), which may appear fair enough if the persons a high flying business sort I see no problem with this. Though sadly when their limit is 15,000 and the bank has let them spend 2,000 over their limit I see two problems.
Firstly how could an responsible lender allow a customer to spend a substantial amount over their limit? Surely the purpose of a "limit" is to, ahem, "Limit" what the customer could spend on the card?
However to blame the bank completely voids the idea of a customer knowing how to wisely use their card, a customer should never spend over their limit. I accept banks allowing customers to do so is wrong, but if the customer wants to know the key step to using their card, one of the major ones is never spend over your limit. Most British banks will add on a fee for every month in which a customer is over their limit, thus leading to a spiral of debt.

A major cause of my work is customers failing to make their minimum payments, which results in the customer falling into arrears (money left owing to the bank). Now this is a second key thing to remember when having a credit card, if you are going to use your credit card to live off, as opposed to take advantages of reward schemes and pay the balance, meet your minimum payments. These are usually quite small in regards to your balance (often around 10%) and are quite manageable on their own, though missing them could lead you down a muddy path. For example missing 1 payment of of 100 would result in a late fee (typically around 10), and if you fail to make that payment before the following one is due (which it's self maybe for a similar figure) you could effectively be paying 230 in 1 lump sum which may be unmanageable for some customers. Don't forget as well as a late fee customers are charged interest on their balance.

Carrying on with minimum payments, these often aren't the greatest ways to pay off your balance, as they could be just 10% of your balance, every month, you could end up in a debt that does become smaller, but the interest on the balance could well make your payments relatively minuscule. Effectively meaning your paying more over the long run as the bank are putting interest on your account and your payment is pretty much paying just over that off in some cases. A better way to handle this would be to make a bigger payment if you could afford it, just to keep your balance under a bit of control.

To avoid late fee's many customers are setting up direct debit's to take the money from their normal bank account to pay off their credit cards. Though I do agree this is the best system to make the monthly payments, I keep asking myself, why customers persist in having a credit card if they have a bank account with money in. As far as I'm concerned those with a credit card should use it only in emergencies and for purchases where credit cards provide insurance (package holidays has recently been covered in the news, where flights bought on a credit card are insured), and should, personally, be paid off immediately.

Paying your monthly payments too early is another foolish thing to do, remember making payments too early doesn't constitute a payment in regards to your monthly payment, it's merely acts as a payment on your balance. Fair enough if your making a payment to pay off the whole balance, but don't assume that because you made a payment equal to your estimated payment that it will be taken as your monthly payment. This has caused so many headaches amongst both collections staff and customers as collections staff try to explain this point and customers make disputes to customer services regarding it. It seems to me personally, as though it's bending the rules by the banks and customers perhaps should be advised that the payment will merely be taken off the balance and not be regarded as a minimum payment.

Fixed agreements/arrangements, if your a customer and in financial difficulty, call customer services, almost all banks will be happy to set up an "F/A". These are often at a lower (or in fact 0% in some cases) interest rate, and are used by customers to pay a portion of the balance (usually less than the minimum payments) until the customer gets back on their feet. However these to are a headache for collections, as often customers won't have had them confirmed with customer services (so theirs no notes on our system) so we don't know about the agreement until the customer tells us and we cycle back through their statements. Customers need to remember the banks don't want you to go bankrupt (because they get nothing) and are often happy to receive a smaller but regular payment than nothing at all. Good communication between customer and bank is needed here, sadly their seems to be a break down of this all to often with the company I'm working for. However a fixed agreement may look bad on your credit rating whilst it's in place.

When collections call (this is a personal point) don't treat them like idiots, they aren't trying to demand you pay off the balance, often they are just asking for the arrears (and over limit amounts). It seems many customers want to be rude and vulgar to people who (I know it doesn't always seem like it) are trying to save you money (by avoiding more late fee's, over limit fees and lowering your interest). It may not always be practical to take a call from collections, but the collections member will usually be willing to point you to making a payment through a means other than over the phone. If they call don't talk down to them as if they have just shot your first born, they are doing a job intended to stop bailiffs from coming around.

In short stay on top of payments and make sure you pay them at the right time other wise charges can become a bane of your financial existence, also make sure never to go over your limit for the same reason. If your experiencing problems get in touch with the bank, they want to keep you as a customer if you owe them money as oppose to you going bankrupt, so tell them if you're unable to make full payments as soon as possible so they can help you out. Don't treat collections staff with contempt they are there for your support, and are looking at trying to help you, not try to take the meal off your plate.