Creditnet News Story
Pew study says credit card reform has been effective
Monday, July 26, 2010
By William Davis
A new study has found that many of the changes lawmakers intended to make with the Credit Card Accountability, Responsibility and Disclosure Act have worked to consumers' benefits. But there is still work that needs to be done to prevent other abuses from lenders.
According to the report from Pew Charitable Trusts, many of the practices from credit card companies that the Federal Reserve Board called unfair and abusive have been reined in considerably. For example, issuers are no longer allowed to implement penalty interest rates as soon as a consumer makes a minor account misstep or raise interest rates on existing balances, except in special circumstances.
However, they have worked around the laws in some cases. Credit card lenders have sharply increased fees for cash advances and enacted interest rates that they fail to disclose on their website.
A report from consumer advice website Wallet Pop said that many credit cards have also re-introduced annual fees, an account feature that was missing from the credit landscape for a number of years. Some banks are even charging customers between $1 and $9 to receive a paper statement in the mail until they opt out of the program.
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