Fed proposes more credit card protections

AP News
Posted: Oct 19, 2010 10:51 AM
Fed proposes more credit card protections

The Federal Reserve is proposing to provide some additional credit card protections to prevent customers from being socked with exorbitant interest rates.

Under the proposed rules, credit card companies that offer to waive interest rates for six months would be barred from ending the promotional period early and charging higher fees, unless customers fall more than 60 days behind on payments. The Fed also recommends limiting the fees customers may be required to pay before they open an account.

The proposed changes would make sure credit card customers in these instances would be covered by stronger consumer protections provided by Congress in a 2009 law. The last of those rules went into effect in August. The Fed is proposing the changes to clear up confusion in how companies apply the new rules.