Banks and Consumers Brace for New Credit Card Rules
Mary Richard | December 14, 2008 at 02:54 amby
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The US credit card industry may face a day of reckoning on Thursday.
The Federal Reserve is to vote on credit card reforms that may bring some relief to customers who face a variety of ways for being hit with late fees, universal defaults, shorter payment periods and confusing payment allocations for different balances.
Credit card companies have warned that interest rates charged on credit cards will rise for all borrowers and that borrowing limits may be reduce because of the changes.
As delinquencies and charge-offs -- balances written off as uncollectible -- on credit cards rise, investors demand higher yield spreads for credit card-backed securities.
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