Would a Credit Card Bill of Rights Ultimately Help or Harm Consumers?

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Credit cards offer tremendous convenience, the ability to handle unexpected expenses and a means to manage payments for major purchases.  The majority of U.S. households have no credit card debt, according to the Federal Reserve’s latest Survey of Consumer Finances.  About a quarter have no credit cards and an additional 30% pay off their balances every month. 

While problems may exist in the credit card market, the positives far outweigh the negatives.  For example, half of all start-ups are funded by the owner’s credit cards.

In an economy experiencing a housing downturn, record energy and food prices and rising unemployment, many American consumers need their credit cards to get them through times when income is tight and non-budgeted expenditures – like a car repair or medical emergency – may arise.  Now is not the time to force credit card issuers to tighten their underwriting standards, which is what the Credit Cardholders Bill of Rights (HR 5244) would do.