By Eileen A.J. Connelly, AP Personal Finance Writer
NEW YORK (AP) — The benefits of stricter credit card regulations appear to have come without the predicted drawbacks — at least so far.
It's been nearly six months since a sweeping law changed how credit card companies are able to hike interest rates, charge over-the-limit fees and apply payments. Because the tighter regulations cut into several profit centers, banks were widely expected to replace lost revenue by bringing back annual fees, cutting expensive reward programs and doing away with limited time, ultra-low rates for new customers.
But data suggests none of those things has happened.
The number of new credit card offers has leaped from the lows hit during the recession, and the offers landing in mailboxes don't reflect the predicted changes.
In fact, annual fees are less common. According to marketing consultant Mintel Comperemedia, 28% of mailed offers in the second quarter had annual fees, down from 33% a year ago.
There's also been little change in rewards programs, which still come with 80% of card offers, Mintel found.Short-term introductory rates, commonly called teaser rates, have actually increased to 56% of offers, from 37% a year ago. Many of these offers are made at 0%, and in some cases that rate lasts for as long as 16 months.
"I think some of the doom and gloom speculation from a year ago was probably exaggerated," said Andrew Davidson, Mintel senior vice president. While card companies have been forced to change some of their terms, he suggested these figures show they have been able to navigate the new law without most of the predicted consequences