Credit card interest rules change

Following August's new Credit Card Accountability, Responsibility and Disclosure or otherwise known as CARD, consumers have been given more protection from the industry. This is because, now consumers have a right to Say NO to interest rate hikes and other changes in credit card agreements. There are going to be several phases of this new initiative under UK law.

But some of the main points that we can expect from it now include:

• A change from 15 days of warning about charges to credit card accounts, to now where at least 45 days of warning needs to be applied by the credit card company if the customer has incurred any charges on their credit card.
• Customers have now at least 21 days to pay their credit card balances, without the threat of late fee payments
• Consumers have the right to opt out of interest and fee increases, whilst they can still pay off the balance at the previous lower interest rate. Before, issuers offer opt-out preferences at their discretion, and it was not a consumer right. All this has changed now.

There will be further regulation changes in 2010, and some of this changes will include not being able to market credit cards to young adults, a reform on shopping gift cards and the regulation of said shopping cards, as well as further regulations and restrictions on interest rate increases.

All this is good news for the consumer, who for too long has been taken for a ride by the credit card companies and hit with interest rate increases for sometimes no valid reason.