The credit card industry has been out of control for sometime now and with consumers carrying the load of high interest rates, random fees and large debt the senate will be passing new amendments to bring the credit card industry under its control.
"We missed the mortgage thing by not acting quickly enough," said Edmund Mierzwinski, federal consumer program director for the Public Interest Research Group. Regulators said. "People are losing their homes because the banks were unfair. Now we've got the credit card industry. And people will end up in debt for the rest of their lives, and maybe we ought to do something."
Travis B. Plunkett from the CFA said everyone knew that amendments were sure to happen but the question on everybody's mind is how useful the amendments will be and what changes they propose to make.
Credit card companies up till now did not have to show their interest rates to anyone but their consumers and now after the new amendment the government has made sure they keep a control over interest rates.
There are many proposals which have been formed and the National Credit Union Administration along with the Federal Reserve have said that all proposals must be formally addressed by the end of the year.
The credit card industries still stands tall against all the amendment, unaffected so far even to the bill passed by Congressman John G. Finneran Jr. of Capital One Financial Corporation, who said "it would be unwise - especially at this time - to enact broad legislation that sets payment formulas in statute, redefines critical product features and limits the tools of risk management for consumer credit."
Ken Clayton, VP of American Bankers Association, said in an interview that "regulation can have unintended consequences, including reductions of popular low introductory-rate balance transfer offers and higher prices for prime borrowers." He also said lesser transaction would lead to the loss in the industry.
Barney Frank, a Democrat from Massachusetts said the Federal Reserve must give other branches some of its power. "At that point, I said use it or lose it," Mr. Frank recalled. "And subsequent to that, the Fed began using its authority, and is now proposing rules similar to those in our credit card bill."