Credit Card Accountability, Responsibility, and Disclosure Act (CARD)

Credit Card Accountability, Responsibility, and Disclosure Act (CARD)

The Credit Card Accountability Responsibility and Disclosure Act of 2009 or Credit CARD Act of 2009 was passed by the United States Congress and signed by President Barack Obama on May 22, 2009. It is comprehensive credit card reform legislation that aims "...to establish fair and transparent practices relating to the extension of credit under an open end consumer credit plan, and for other purposes."

Key features include:
•    Protections against arbitrary interest rate increases
•    Elimination of penalties on cardholders who pay on time
•    Clarification of due dates
•    Protections from misleading terms
•    Cardholders have right to set limits on their credit
•    Card companies must fairly credit and allocate payments
•    Prevents card companies from imposing excessive fees on cardholders
•    Better Congressional oversight of the credit card industry
•    Limits credit cards to teens

Cry Wolf Quotes

“As an industry leader, Chase does not engage in several practices -- universal default, two-cycle billing and increasing a rate based on a change in a credit score -- addressed by the bill, but we believe the legislation as passed today has the potential of increasing overall costs to consumers, reducing access to credit, and reducing or eliminating low-rate options for consumers.”

-
Stephanie Jacobson, first vice president of public affairs for Chase Card Services. CreditCards.com.

Passing legislation like this will discourage lending. This comes at a particularly bad time when consumers and our economy have already had enough stress to deal with. It's not wise policy to create a consumer credit crunch at the same time that our economy is experiencing a commercial credit crunch.

-
Rep. Pete Sessions (R-TX), CreditCards.com.

[The bill would] have a dramatic impact on the ability of consumers, small businesses, students, and others to get credit at a time when our economy can least afford such constraints.

-
American Bankers Association, AP

I think that every single company that offers a credit card is reassessing its cost….reassessing what they do and how they do it.

-
Marcia Sullivan, director of government relations for Consumer Bankers Association, USA Today.

Evidence

Backgrounders & Briefs

A Timeline of the CARD Act

An interactive timeline of credit card reform.