The Credit Card Act For Young Consumers

1548 Words Oct 6th, 2015 7 Pages
In May 2009, President Obama stated, “The credit card act was intended to uphold basic standards of fairness, transparency, and accountability (Lindow).” Is this to say that credit card companies were deliberately deceiving consumers to capitalize on profits? Unfortunately, the answer is yes: profit was not the concern of this act, as the banks had abnormally high profit margins. What was in question, however, was the approach of generating these favorable profits for banks (Warren). The Credit Card act provides protection for young consumers with specific provisions such as: fix interest rates, 21 day grace period, the right to opt out of adverse changes in terms, a 21 year age requirement and clearer agreements for transparency.
Each provision provides different advantages and disadvantages to consumers and creditors. In order to better understand, let’s break some provisions down piece by piece. First up is the statement delivery and due dates provision. Prior to this act being passed as a law, credit card companies sent out statements within 14 days or under the due dates (Detweiler). This could be seen as a slick move to keep information from the customers. For example, let’s say you had a due date of the 22nd of each month, creditors would send you a statement around the 8th of each month: leaving customers with less time to gather funds to liquefy their current debt. However, after the act was passed, in the same example as previously stated, you would now receive…
Open Document