The Credit CARD Act of 2009 goes into effect today, hopefully ushering in a safer and fairer era of credit card usage in America.
Credit cards became popular shortly after their introduction; their advantages compared with cash and checks were numerous.
But as time went on, the finance industry found ways to add fees and use tricks to increase their profits on credit cards while hurting consumers.
Banks have argued, with varying degrees of truthfulness, that their policies are fair and reasonable. Banks do have a right to make a profit, particularly when lending to riskier customers.
But it seems that they have gone too far recently. Particularly mean-spirited acts such as â€œretroactivelyâ€ increasing interest rates and changing the terms of the credit card after just one late payment are an insult to consumers.
The people who end up paying the most in fees are often those who can afford it the least. While wealthier and more savvy people can figure out how to safely manage their credit, the load of credit card fees end up on those poorer and more naÃ¯ve people who just donâ€™t understand the banking industryâ€™s games.
We hope this law will help to shelter those who have often been preyed upon by the finance industry.
This group often includes students who are intoxicated by the thrill of access to easy credit and spend too much too soon. While this law wonâ€™t stop students from doing stupid things, like buying a boat on credit, it will at least protect you from getting hit by fees and tricks that you donâ€™t understand.
Credit cards are a wonderful tool when used properly, like for building credit. Hopefully with the enactment of this bill, these tools can again be used for good.