WASHINGTON (TheStreet) -- Credit card issuers should expect a wave of new rules if the Federal Reserve Board moves ahead with proposed its implementation of the Credit Card Accountability Responsibility and Disclosure Act of 2009.
On Tuesday the Fed proposed a rule amending the Truth in Lending Act, or Regulation Z, that would offer protections against changes to promotional interest rate and fee programs used to entice new customers.
For example, a card issuer that offers to waive interest charges for six months would be prohibited from revoking the waiver for the promotional period unless the account becomes more than 60 days delinquent, the notice says.
Additionally, fees that a consumer is required to pay before a credit card account is opened are covered by the same limitations as fees charged during the first year after the account, the Fed says. The total amount of those fees also cannot exceed 25% of the account's initial credit limit.
Credit card issuers must also consider information regarding the consumer's independent income, rather than household income, when evaluating whether the consumer is credit worthy for a new card or looking to increase their limit on an existing credit card, under the proposed rule..The rule proposals are intended to "enhance protections for consumers and to resolve areas of uncertainty so that card issuers fully understand their compliance obligations," according to the notice posted in the Federal Register.
Banks including large card issuers like Citigroup