The substantial reforms in this bill are needed now more than ever, as working Americans have increasingly turned to credit cards to help pay medical bills, buy groceries, and make ends meet in this troubled economy.
Carolyn Maloney, Congresswoman (D-NY)

The House Financial Services Committee today approved Credit Cardholders' Bill of Rights (H.R. 627), sponsored by Rep. Carolyn B. Maloney (D-NY). The bill was passed by a vote of 48 to 19. The bill now moves to the House of Representatives for consideration.

"The substantial reforms in this bill are needed now more than ever, as working Americans have increasingly turned to credit cards to help pay medical bills, buy groceries, and make ends meet in this troubled economy," Rep. Maloney said.

Specifically, the Credit Cardholders' Bill of Rights would:

- Protect cardholders against arbitrary interest rate increases
- Prevent cardholders who pay on time from being unfairly penalized
- Protect cardholders from due-date gimmicks
- Prevent companies from using misleading terms and damaging consumers' credit ratings
- Empower cardholders to set limits on their credit
- Require card companies to fairly credit and allocate payments
- Prohibit card companies from imposing excessive fees on cardholders
- Protect vulnerable consumers from high-fee subprime credit cards
- Bar issuing credit cards to vulnerable minors

The committee also approved the following amendments this afternoon that would:

- Amend the effective date section to provide that, starting 90 days after enactment, no APR increase (except for limited rate increases described in the amendment) could take effect unless the creditor provided a written notice at least 45 days before such increase (Introduced by Rep. Carolyn Maloney)

- Require the Federal Reserve, in consultation with the other federal banking agencies and the FTC, to report to the House Financial Services Committee and the Senate Banking Committee, within 6 months of enactment, the extent to which creditors over the previous 3 years have reduced credit card limits or raised interest rates for individual consumers for reasons relating to general characteristics of their credit transactions, such as where or with whom they shop or how much they pay. (Introduced by Rep. Maxine Waters)