Tester thanks Obama for ‘turning up the heat’ on credit card industry

Senator calls for swift passage of his legislation to reform U.S. credit card industry

(WASHINGTON, D.C.) – Senator Jon Tester today thanked President Barack Obama for pressuring the nation’s top credit card companies to end abusive practices.

Tester also called on the U.S. Senate to pass his legislation to “restore honesty and common sense” in the U.S. credit card industry.

“I’m glad the President is turning up the heat on the top brass in the credit card industry,” Tester said.  “Folks are fed up with hidden fees, surprise interest rates and small print.  That’s why I’m taking a lead in the Senate to turn common sense into law.  Montanans—and all Americans—deserve no less.”

At the White House, Obama today met with top executives of the nation’s biggest credit card companies to urge more common sense in the industry.  Obama warned the companies to stop unfair rate increases and other abusive practices.

Tester, a member of the Senate Banking Committee, helped write the Credit Card Accountability Responsibility and Disclosure Act, also known as the Credit CARD Act.  Tester included language in the bill to ban the practice of increasing interest rates on customers who miss payments on other bills but continue to pay their credit card bills on time.

A key committee in the U.S. House of Representatives passed similar legislation this week.

In addition to protecting customers who pay their bills on time, the Credit CARD Act also:

  • Gives cardholders an additional week to pay their bills (by requiring credit card statements to be mailed three weeks before the bill is due rather than the current two weeks).
  • Limits fees and penalties (by outlawing interest on transaction fees such as late fees and over-limit fees, and prohibiting companies from charging fees for customers who pay their credit card bills via phone, over the internet, or by mail).
  • Bans credit card companies from exploiting young Americans (by requiring most credit card applicants under the age of 21 to get a signature from someone willing to take responsibility for the debt, and limiting credit card offers to customers between the ages of 18 and 21).

The full Senate is expected to consider the Credit CARD Act in the coming months.