Released: October 09, 2009

Legislators push to have credit card reforms effective sooner

Source: Kathy Chu, USA Today

Lawmakers scolded banks Thursday for raising credit card rates for millions of consumers and businesses, saying their actions show the need to enact legislative reform quickly.

During a hearing, House Financial Services Committee Chair Barney Frank, D-Mass., warned the industry that its rate hikes were not going unnoticed. A new law will restrict banks’ ability to raise interest rates on existing card debt and require them to apply payments in a way that helps consumers get out of debt faster. But Congress gave banks until February to make the changes.

It’s clear now that this reform “shouldn’t wait, and we should move forward,” says Frank, who has introduced legislation with Rep. Carolyn Maloney, D-N.Y., to move up the law’s effective date to Dec. 1.

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