It is not about the fees, it is about making you feel responsible. The average Joe will now not care about balances, amass them in collections, bad credit, and ultimately bankruptcy.
If you really need to declare bankruptcy, then that also drops off in 7 years. I knew a coworker that amassed 100k in credit card debt, declared bankruptcy and then in 2 years he had credit cards again from the SAME creditors. Even go a car loan and mortgage shortly after that.
Even countries default. Such is the risk of giving money to someone else: they might not actually pay you back. Maybe these banks should think thrice before extending lines of credit to people.
But they want to efficiently allocate the funds, don't they? Let them reap the consequences of their own decisions.
Not sure it’s the norm