Right from the time the CARD Act came into effect, it has been a hot discussion topic among financial analysts and experts. While it is indeed true that this Act has brought about the much needed transparency in the credit card industry and prevented the credit card issuers from abusing their privileges, there still existed some loopholes around which banks and other financial institutions began to function. In a move to curb this, the Federal Reserve has given approval to a few more changes that will see the light of the day from the 1st of October, 2011.
As per one of the new rules that have just gained approval, credit card companies are barred from considering the household income of the applicant while approving credit cards. Going forward, banks have to take into consideration only the income of the individual and approve the application and set credit limits accordingly. While this move makes it difficult for first time credit card applicants, it will prove to be tougher on spouses who do not go to work.
According to another rule, banks have to be careful while promising promotional offers because once they offer it to the customers they cannot revoke it at their whim and fancy. Even the introductory interest rates cannot be varied until the card holder defaults that payments by at least 2 months.
While these new rules will definitely make things slightly difficult for the issuers, it certainly brings about a welcome change for many card users.