Prediction #2: Banks will not enact reforms to keep their customers happy

New credit card rules were enacted by federal banking in December 2008. These rules are supposed to stop “unfair or deceptive” credit card industry practices by limiting interest rate increases on past purchases, more easily understood disclosure of terms and getting rid of what is called the “gotcha” process that cost consumers millions in fees and interest. Of course, they do have until July of 2010 to implement these changes in billing, marketing and advertising systems. The average cardholder will probably not notice any difference in their credit card.

This 18-month period may not affect retail merchant account credit card processing, but it will affect card issuers of all sizes. If the larger card issuers implement the rules quickly, smaller issuers may feel pressured by the competition to follow suit.

Banks and card issuers that implement these rules early could be put in a good light and get some positive public relations out of it. However, there will be those that drag their feet and wait until the last minute to accomplish this. Retail merchant accounts should not be affected by these changes.

One credit card company has actually already started, Capital One. In fact, they have taken it to a higher level by disclosing more than they are actually required to. This may put them ahead of other card issuers because there may still be more credit card regulations coming. Congress intends to introduce legislation in 2009 that is meant to fill any gaps that may have been left by the federal card rules so far.

Credit Card Predictions for 2009, Prediction 1