The Credit Card Act and Its Importance

In 2009 there was a federal legislation passed called The Credit Card Act, also known as the The Credit Card Accountability, Responsibility, and Disclosure Act of 2009, to protect people who own credit cards from commiting excessive lending that is placed and practiced by the people who issue the credit cards. The Credit Card Act was performed in response to the credit card issuers from continuing abusive practices. One of the abusive practices was interest hikes. Companies would increase interest without the credit card user being notified and most cases there wasn’t any reason for the interest increasing, it was working in their favor because the customers could not do anything about it. Another reason is marketing of underage customers. Companies underwent advocation of credit card usage in places where underage people were concentrated in. They went to High Schools and lure their attention with prize. Lastly, the biggest factor was random fees and obfuscation. It made it unable for people to see why and what they were charged for and automatically processed to their account. After the legislation, there haven’t been any big issues in the credit card world. There isn’t any random interest rate changes, arbitrary feed, better grace periods (21 days before due date) and lastly, there is more security on underage customers.

This year marks 10 years since the Credit card act was passed and since then there have been changes in society that can affect the way consumers see credit. Since 2009, the rise of student debt has incredibly increased leaving young people with more imposed debt after university than ever before. This has led to a drop in credit accounts although they are still growing- just not as fast as in other years. Also factoring in that we are already at a trillion in credit card debt as a country (and only growing) it is possible that people explore alternate ways to finance their lives. This is why I believe that there should be more systems and resources available so that people can become less reliant on credit cards that only lead them into debt such as affordable healthcare and education.

In conclusion I believe that the credit card act was very crucial in regulating national debt and consumer spending acting as a security for human error. This act was put in place to protect the average consumer, which is something I can always get behind. However, one thing I would change is actually making it a little harder for anyone to get a credit card, and make it so that those only qualified are allowed to get them. I say this so that people who aren’t able to finance a credit card shouldn’t put themselves into debt – which is a downward spiral that can only get worse in most cases. I’ve seen this happen too many times in my own life which is why I would support an overall reform with the requirements to receive a credit card with all credit companies.