Statement Urging House to Pass 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:
"In this economic climate, allowing credit card issuers to continue to engage in unfair and deceptive practices is like letting a car company continue to sell cars we know have faulty brakes. Congress needs to act now to give consumers protection under the law from business practices that the Federal Reserve and our independent research have shown are widespread. We strongly urge members to vote tomorrow for the Credit Cardholders' Bill of Rights to protect consumers and make it clear that this Congress demands safe and fair lending practices."
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 is recommending 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.