Fed announces final rules for credit cards

The Federal Reserve Board recently published final rules regarding credit cards, which will take effect on August 22.

With the new regulations, credit card issuers will have to assess penalties based upon minimum payments. In other words, consumers who owe $20 and pay late can’t be charged more than that in fees, which are capped at $25.

Fees, however, can be higher if an account holder makes a habit of paying late or violating the terms of their card agreement. Fed Governor Elizabeth Duke said the new rules should make things fairer and less expensive for consumers.

"Card issuers must also reevaluate recent interest rate increases and, if appropriate, reduce the rate," Duke said.

Any rate increases that occurred after January 1, 2009 will have to be re-examined by companies that issue credit cards. If the causes of the rate increases have changed, a reduction may be in order.

The new rules come by way of the Credit Card Accountability, Responsibility and Disclosure Act, which was passed last year. Some changes from the law are already in effect, such as requiring that payment due dates are the same every month.

Posted in: Consumer Credit Cards

Consumer Credit Cards News: This article was published on 6-17-2010 at 11:01 am.

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