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| FED Unveils Card Disclosure Changes |
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Credit card issuers may have to disclose interest rates and fees in clearer, easier-to-understand language if the Federal Reserve adopts new consumer-protection rules unveiled May 23. The proposed rules, which could be in effect by the end of the year, followed a 2 1/2 -year study. The changes would be most significant in 26 years. They come at a time when Congress is considering efforts to curb aggressive marketing and pricing practices by retail lenders. In coming up with its proposal, the Federal Reserve questioned small groups of consumers on how best to word some sections of the new rules. The new rules would require companies to tell customers 45 days before terms of a credit card contract are changed, compared with 15 days now. And the rules would expand the list of changes requiring advance notice to include those involving penalty interest rates, which often range above 30 percent. Today, most consumers learn only after opening their monthly bills that they have been penalized with significantly higher interest rates because of paying late, going over their credit limits or falling behind with another lender. The new proposal calls for larger type in some instances. It would also require companies to say on monthly statements what interest and fees a customer had paid so far for that calendar year. Companies would also be required to spell out that low rates on balances transferred from another credit card apply only to that balance, not to new purchases. And it would require companies to apply payments to the debt carrying the highest interest rate. Credit card issuers praised the proposed rules yesterday, saying the complexity of pricing for credit cards and other revolving credit over the past two decades has overtaken current regulations. The Fed will seek comment for four months before issuing final rules. |
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Strategic Leadership &
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2009 ETA Annual Las Vegas, NV |
| 2009 Annual Meeting |
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 2008 Annual Meeting Exhibitor Information is Here! If you're planning to join the leading companies in the payments business in the ETA Annual Meeting exhibiton hall next April, now is the time to reserve your space and make your plans. Everything you need is here . |
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