WASHINGTON, D.C. – U.S. Sen. Sherrod Brown (D-OH) today highlighted a report from the nation’s top consumer agency showing how stronger credit card rules have saved consumers $16 billion in fees, reduced borrowing costs, and expanded access to credit.
Since 2011, the Credit Card Accountability Responsibility and Disclosure (CARD) Act, which Brown helped pass, has saved consumers $9 billion in over-limit fees and $7 billion in late fees, according to the Consumer Financial Protection Bureau’s report. The law has helped lower the total cost of credit by two percent and increased available credit by 10 percent since 2012.
“This report provides clear evidence that the CARD Act is saving people real money and making credit more available, while also benefiting credit card companies,” said Brown, ranking member of the U.S. Senate Committee on Banking, Housing, and Urban Affairs. “It debunks the early claims from opponents who said the law would hurt consumers and the financial services industry.”
Brown was an original co-sponsor of the CARD Act, which went into effect in early 2010 and applies only to credit cards. The law is aimed at protecting American consumers from unmanageable debt and deceptive and predatory credit card practices. It increases transparency in the credit card industry by requiring enhanced disclosure of contract terms while improving billing and marketing practices.
The law curtails excessive late fees and penalties on cardholders, protects consumers from unfair interest rate increases, and requires credit card companies to mail bills 21 days in advance instead of 14. It also limited the aggressive marketing of credit cards to students on campuses and to persons under age 21.
Nationwide, credit card debt now totals $714 billion, up $11 billion from last quarter, according to the Federal Reserve Bank of New York.