Raised interest rates on nearly one-quarter of credit cards cost consumers more than $10 billion in 2008, one of the many damages of unfair credit practices the Pew Charitable Trust said it hopes to prevent through a list of standards the company released
The Pew’s Safe Credit Cards Project, which was conducted in partnership with the Sandler Foundation, involved researching credit card issuer’s revenues and products, consumer card use, and included interviews with card providers and consumer groups. Through its research, Pew pointed out practices that the company labeled as “unsafe and deceptive,” and outlined guidelines for credit companies that would ensure cardholders could agree to interest rates, have “sufficient” time to review and pay their bills and avoid interest changes on existing credit balances.
Pew also called for legislative reform, and voiced its support for credit card regulations adopted by the Federal Reserve in December 2008, but lamented that the new laws would not take effect until July 2010. Pew also expressed the need for immediate legislation, such as the Credit Card Accountability Act, which was approved by a Senate panel on March 31, and the Credit Cardholders’ Bill of Rights, which has passed an initial House of Representatives review.
“If we learned that a car company designed a car with faulty brakes, we wouldn’t let them continue to sell it and put people in danger for nearly a year and a half — we’d make them stop now,” said Nick Bourke, manager of Pew’s Safe Credit Cards Project. “Congress needs to do the same with credit card companies — fix unsafe policies before more families are hurt.”