THE WALL STREET JOURNAL BLOG REPORTED TODAY that “Card issuers are saying one thing and doing another” in response to the credit-card industry reforms that will take effect in February 2010. The post is based upon a Credit Card Study by Bankrate, which looks at the details of 20 card issuers. One thing that will continue is that credit card companies will still be demanding high fees.
Furthermore, Ellen Cannon, Bankrate’s managing editor, states that the use of the term “universal default” is an example of credit cards saying one thing and doing another. “Universal default generally means that card issuers can look at a consumer’s overall credit profile and change the terms as they see fit. Most issuers say that they don’t practice universal default. ‘But they tell consumers they change things ‘because of market conditions,’ Cannon says. ‘It’s practically the same thing.'”
Which is why analysts believe the credit card companies are expected to make big profits in spite of the regulations. The card companies will continue to take advantage of consumers while keeping a large percentage of the world’s population trapped in the never-ending debt cycle.
Click here to read the Wall Street Journal article on their blog.