Statement Applauding Bipartisan Passage of the Credit Cardholders' Bill of Rights
Washington, D.C. — Nick Bourke, manager of the Safe Credit Cards Project at the Pew Health Group, issued the following statement:
"The passage of the Credit Cardholders' Bill of Rights is a victory for all consumers and for credit card issuers who want to offer a safe and fair product. We are pleased that this bill received bipartisan support and that members of the House of Representatives are working across the aisle to stop unfair financial practices. This bill will provide consumers with protection under the law from deceptive lending policies that both the Federal Reserve and our research have shown to be widespread. We urge the Senate to pass similar legislation quickly to restore transparency in the credit card market and ensure consumers have strong, permanent protection."
The Pew Safe Credit Cards Project recently evaluated general purpose credit cards offered online by the largest 12 issuers, which control more than 88 percent of all outstanding credit card debt in America. Based on its research, Pew developed a set of Safe Credit Card Standards and recommended immediate legislative action from Congress.
Select findings from the research include:
- 100 percent of cards contained features that the Federal Reserve has determined cause substantial harm to consumers.
- 93 percent of cards allowed the issuer to raise any interest rate at any time by changing the account agreement.
- 87 percent of cards allowed the issuer to impose automatic penalty interest rate increases on all balances, even if the account is not 30 days or more past due. The median allowable penalty interest rate was 27.99 percent per year.
Read the project's full report Safe Credit Card Standards on Pew's Web site.