Congresswoman Hirono Votes to Pass Credit Cardholders’ Bill of Rights
Legislation Protects Consumers from Unfair Practices
WASHINGTON, D.C.—Congresswoman Mazie K. Hirono (D-Hawai‘i) today voted in favor of the Credit Cardholders’ Bill of Rights Act, H.R. 627, in order to provide common sense reform and consumer protections to our financial system. The Credit Cardholders’ Bill of Rights Act will end unfair practices by the credit card industry and protect consumers from the abusive tactics that continue to drive so many Americans deeper and deeper into debt. H.R. 627 passed out of the House overwhelmingly by a vote of 357 yeas to 70 nays.
“Last year, credit card companies imposed $19 billion in penalty fees and will break all records this year for late fees, over-limit charges, and other penalties, amounting to more than $20.5 billion for the industry,” said Hirono. “The Credit Cardholders’ Bill of Rights will level the playing field between card issuers and consumers.”
The Credit Cardholders’ Bill of Rights Act prohibits credit card issuers from raising rates retroactively on existing balances. The bill also requires a 45-day notice of any rate increase and prohibits companies from charging interest on balances from more than one billing cycle. Members of the House collaborated with President Obama to strengthen the bill by mandating that card issuers apply payments beyond the minimum to debts with the highest interest rate, requiring card companies to inform customers about the long-term costs of paying only the minimum balance, and allowing consumers to opt whether or not they want to go over their credit limit and be charged a fee for doing so.
“This bill will assist families and businesses that have been particularly hard hit by the economic crisis, including those who rely upon credit lines, who, through no fault of their own, have been subjected to predatory lending or abusive credit card practices that make it difficult for them to end the cycle of costly debt,” said Hirono.
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