Credit CARD Act Compliant Credit Cards Still Missing

Even as the original activation date of the Credit CARD Act, February of next year, nears, credit cards that are fully compliant with the requirements of the credit card act are still missing in the credit card market. According to a study made for the Safe Credit Cards Project of the Pew Health Group, virtually all the credit cards being offered online by the majore credit card companies still do not comply with the laws in the Credit CARD Act. Credit card companies still include many of the practices which will be banned once the Credit CARD Act goes live.

This new report by the Pew Safe Credit Cards Project is titled “Still waiting: ‘Unfair or Deceptive’ Credit Card Practices Continue as Americans Wait for New Reforms to Take Effect”. All the consumer credit cards being offered online by the twelve major credit card companies in the U.S. were examined by the report. These twelve major credit card companies play a large role in the credit card industry, accounting for 90% of the outstanding credit card debt in the country, which makes them the perfect focus for the report. Aside from these major credit card companies, the report also examined what the largest credit unions nationwide has to offer in terms of consumer credit cards. The datum of the Pew Safe Credit Cards Project were gathered on July of 2009 focusing on almost four hundred credit cards. The data collect adds on to the previous research done by the group last December of 2008.

According to Shelley A. Hearne who acts as the managing director of the Pew Health Group, the overseer of the project, “Since passage of the Credit CARD Act, we found that credit card issuers have done little to remove practices deemed unfair or deceptive by the Federal reserve”. She further added that, as a matter of fact, a few of the most damaging practices of credit card companies actually became more widespread. “Not one of the bank cards reviewed would meet the legal requirements outlined in the Credit CARD Act, which is bad news for consumers”, she added.

The findings of the report also show that 99.7% o of bank cards allowed their issuers to hike their outstanding balance interest rates, an increase from 93% from the figures collected by the report last December. 95% of bank cards also allowed their card issuers to apply credit payments in such a way as to cause financial distress to consumers according to the Federal Reserve. 90% of bank cards also hiked their penalty rates and a large number of these penalties were imposed by “hair trigger” infractions such as missing one or a couple of payments in one year.