Corporate and Business Accounts Exemption from Consumer Bill of Rightsby Melvin Singleterry (Associated Attorneys)
The government reached a point that they were no longer able to tolerate the abuse that was going on between credit card companies and their card holders and this is why they passed the Credit Card Accountability, Responsibility and Disclosure Act in May of 2009.
The Federal government is trying to assist customers in an effort to avoid major numbers of default accounts which then leads to the credit card company to file for Federal assistance.
These are a few ways that the new act will help:
1. Credit card companies will avoid major numbers in defaulting accounts
2. All terms and conditions for the credit card will be easy to understand and must be provided to the client before acceptance of the terms.
3. Prevent double cycle billing
4. Over the limit fees are limited
5. Interest rates will be regulated
6. Credit card companies will be limited in the amount of fees that they are able to charge for the processing of payments through the phone or electronic transfer.
7. Requires a minimum of 21 days between the mailing of the billing statement and the actual due date
Credit card companies have received several limitations over the past few years, but they are not really stuck in the way that they do business. Congress has still provided credit card companies with some wiggle room. This wiggle room is believed to be allowed simply due to the fact that the credit card companies aid Congress financially with a lot of support.
The Federal government felt that limiting the amount of fees that the credit card company could charge and when they could charge them would be extremely helpful to the consumer. While this is true having a lack of a cap on the interest rate can still be quite counter productive.
The regulations are not perfect, but they are helpful to everyone by corporate and business card holders. The new regulations do not apply to these accounts, and therefore leaves them open to the abuse that has been going on for years.
The credit card companies do not tend to go down without a fight. They have sent out millions of direct mailers to personal household in an effort to have some households take out business accounts with them. They advertise what a great advantage it is for the average household, but they also leave out the fact that you would be personally responsible for any debt that you acquired on the account as well as they would not be limited by the regulations of the Act in terms of billing and fees.