CBS news writer Anthony Mason, writes that after the implementation of the new credit card rules, there are now many concerns about how these rules benefit cardholders in the long run.
Mason says the hikes in interest rates are now taking effect across credit card companies in the country. He says the increase in these interest rates is so high, that they have hit an unprecedented level since 2002.
Mason shares data on 381 million credit card accounts across the United States. He says that new regulations may have helped cap the fees or charges for late payments at 25 dollars, but he still points out at the reality of high interest rates as more pressing for the 381 million credit card accounts. He then mentions the new regulations included the abolition of fees on inactive cards.
Though capping late payment charges and removal of fees on inactive cards may be beneficial, Mason argues that these regulations also step on the roles of banks to properly assess penalty fees. So, as a consequence, banks are now focusing on interest rates, since this is where they still pretty much maintain control except for a few rules.
With the new regulations, Mason also says that credit card companies have already reduced the amount of credit their cardholders are entitled to. From the same period last year, the available credit for a newly opened account was at $4,400 or more. This year however, an 11% decrease was seen with the amount at $3,900.
Although Mason acknowledges that these changes should bring forth positive directions, and lead Americans to be more careful about their spending habits. An economy recovering from the economic recession still needs more.
Consumers advocate groups and organizations have already expressed concerns in the way the new regulations penalize good cardholders. These groups and organizations believe that future credit card account applicants should be entitled to more, such as the credit limit amount, especially when they can prove good and responsible payment capacity.
Mason also adds that consumer advocates mostly consider the cardholders who have been successful in and who are continuously building good credit histories. The consumer advocates worry that those with good credit records can now be threatened by late payment charges because of newly introduced high interest rates, Mason concludes.