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Banking

Federal Reserve Launches Consumer Guide to Credit Cards

Consumers wanting to learn more about recent changes to credit card rules and how they may be affected now have a new resource. The online guide to credit cards summarizes new credit card protections that went into effect February 22. Included on the new Web site are two interactive tools and several other features that help inform consumers about the credit card process.

photo of hand holding a credit card

Features, tools help consumers understand new rules
One interactive feature guides consumers through the terms and conditions that will appear on credit card offers starting July 1. The information detailed in the offers includes the annual percentage rate (APR) for purchases, balance transfers, and cash advances; the penalty APR for late payments or over-the-limit transactions; how to avoid paying interest on purchases; and information on fees.

Another interactive feature helps consumers understand the new information in their monthly credit card statements, including a section that details how long it will take to pay off the balance if only the minimum payment is made and what the monthly payment must be to pay off the balance in three years. The new rules also require credit card companies to notify consumers before they make significant changes to the terms of the card, which can include but are not limited to increases in the interest rate or changes to certain fees.

More features in place and on the way
Other features included on the new site include a credit card repayment calculator, which estimates how long it will take to pay off a credit card balance; information on common credit card problems, such as a lost or stolen card; and a glossary of commonly used credit terms.

In coming months, the Board plans to add more features, including Spanish translations and additional credit card information.

February 26, 2010