Following yesterday’s White House meeting, the President took a balanced approach to credit card reform that should be applauded. While our Representatives have been hastily rushing to hamstring the industry with credit card regulations, Obama recognizes that credit card companies are businesses and seems willing to work with them, rather than against them, to effect change in the way business is done without driving these companies out of business.
One of the key points outlined by Mr. Obama is the need for “comparison shopping for cards.” Your humble head blogger at Smart Balance Transfers applauded this measure, as consumers benefit substantially from the ability to compare rates, fees, and features. (For more on this, please see my quotes in the Christian Science Monitor.)
Having heard so many horror stories from consumers who have had their rates increased lately, I have found myself infuriated at credit card companies. At the same time, however, I understand that these companies need to make money. For this reason, I have been slightly critical of the Credit Cardholders’ Bill of Rights, because credit card companies have been scrambling to make as much money as possible before this becomes law. However, it looks like the President will be trying to usher in new reforms without ruining the credit card business and thus making credit cards less available to the people who need them.
I’m so pleased with the initial reports of the meeting that I’d actually like to go back in time and vote for Obama. Unless, of course, the credit card companies stop lending to credit worthy consumers because of the new regulations.
Sources: White House Seeks Relief for Consumers on Credit-Card Rules, Wall Street Journal, 24 April 2009
