Congress Plans Credit Card Reforms

WASHINGTON – A senior member of the House Financial Services Committee is proposing an array of credit card reforms that would ban certain practices and add new disclosures on billing, balances and payments.
 
The proposal is being circulated by Rep. Carolyn Maloney, D-N.Y., chairman of the Financial Services’ Subcommittee on Financial Institutions, who has been championing the cause of credit card reform for the past few years.
 
The bill would ban the practice of Universal Default for credit already outstanding; eliminate any time/any reason repricing; bar double-cycle billing; require an advance notice of a cardholder’s right to cancel when the rate is increased; set new restrictions on notice to consumers of changes in terms; require disclosure of how long it will take a holder to pay off an outstanding balance and clarify some credit card terms, according to sources familiar with the draft.
 
Maloney is expected to introduce the bill in the next few weeks.