Find the best credit card offers online.A newly released report from Pew Charitable Trusts underlines the fact that no credit cards being released online by the twelve major credit card companies in the U.S. are actually “safe”. “Safe” meaning the card already conforms to the requirements outlined in the new Credit CARD Act which is due to go active soon.
According to Pew Charitable truss, a nonprofit organization based in Philadelphia, all of the credit cards that they surveyed still used practices which are deemed to be “unfair or deceptive” as determined by the Federal Reserve. The organization’s study takes into account credit cards numbering almost 400 advertised by the major credit card companies of the country as well as the biggest credit unions. The study compared the terms offered by these credit cards for this year, 2009 with the figures collected by the study last year, 2008.
Nick Bourk is a Pew’s Safe Credit Cards Project manager. He said, “Our research shows the most harmful practices the card act targets remain widespread”. Pew Charitable Trusts first started studying the relationship between the credit industry and consumers in 2007.
The report also showed that, although the Fed has already lowered federal funds rate to almost zero in order to ease bank lending, credit card holders have yet to see any benefits from these historically very low interest rates. Instead, credit cards have become more expensive to get and maintain since the first half of 2009. The report says that high cost of credit cards gives them a high potential of causing financial disaster among American consumers who carry them.
Numbers from the study showed that the highest percentage point increase for lowest-advertised rates belonged to Discover Financial Services. The company increased their rate from 9.99% to 12.99%. Second largest credit card company Bank of America Corp. gets the distinction of having the biggest hike in the highest advertised rate, rising from 14.99% to 18.24%.
The study also took into account the difference between business practices among major credit card companies and large credit unions. According to the study, credit unions issued fewer penalty charges and charges were less severe in comparison to credit card companions. The lowest advertised rates among credit unions were also lower than those being offered by credit card companies. Credit unions offered rates ranging from 9.9% to 13.75% compared to credit card company rates, which range from 12.24% to 17.99%. Among American consumers, credit unions account for only 1% of overall credit card lending, the study reports.
