Credit Card Companies Oppose House Bill

Credit card companies are opposing a House bill that is aimed at making life easier for consumers who hold credit card accounts. The bill's goals are to stop arbitrary interest rate increases, as well as hikes in fees and penalties for customers who don't pay on time or have changes in their credit ratings.

The card companies say they prefer a Federal Reserve plan that would require lenders to more clearly elucidate the terms of their credit agreements. They warn that the House bill would limit business and cause everyone to pay higher rates if lenders were not allowed to reprice the risk based on the borrower's credit history.

Many consumers have found their interest rates being increased because of a late payment on another debt that is not related to the credit card. Protecting consumers from this practice of penalizing the consumer with higher rates on a debt for which they have not been late in payment or defaulted on was partly the reason that the House bill was drafted.