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You can summarize Congresswoman Carolyn B. Maloney’s suggestions to the credit card industry in two words.
Play fair.
The chair of the House’s subcommittee on financial institutions and consumer credit issued four “gold standard” principles she’d like to see card issuers adopt, including:
- Issue Credit Cards on Terms that the Individual Can Repay.
- Clearly Explain Account Features, Terms, and Pricing at Relevant Times.
- Provide Customers Notice and Choice with Respect to Changes in Terms.
- Encourage Responsible, Successful Credit Use, Especially Among New Credit
Entrants and Customers With Special Needs.
None of these broad general principles, or even the specific examples she gives–such as eliminating double-cycle billing and any-time-any-reason repricing, clearly telling customers what behaviors can lead to a rate increase and allowing customers to block approval of transactions that would take them over their limit–are revolutionary or onerous to the industry. What’s appalling is that the practices she’s targeting ever took root at all.
