Obama signs law to curb credit card fees
Associated Press | 5/27/2009, 4:57 a.m.
And consumers will also have to receive 45 days’ notice and an explanation before their interest rates increase.
Despite being touted as a victory for consumers, financial experts said the bill could have unintended consequences as credit card companies look for ways to make up for potential lost revenue. Those measures could include more cards with annual fees and the loss of a grace period before interest accrues, which would affect even those consumers who pay off their balance each month.
Last year, the Nilson Report estimated that more than 700 million credit cards were in circulation in the United States. That’s more than two cards for every man, woman and child.
The president noted that nearly half of all Americans carry a balance on their credit cards, and that their average balance is more than $7,000.
Obama decried the “uneasy, unstable dependence” that a minority of card users have on credit.
“So we’re not going to give people a free pass, and we expect consumers to live within their means and pay what they owe,” Obama said. “But we also expect financial institutions to act with the same sense of responsibility that the American people aspire to in their own lives.”