Consumers, banks brace for new rules on credit cards

Washington: The US credit card industry, harshly criticised for imposing surprise fees and interest rate hikes on consumers, may face a day of reckoning on Thursday.

The Federal Reserve is to vote on credit card reforms that may bring some relief to customers who face a variety of ways for being hit with late fees, universal defaults, shorter payment periods and confusing payment allocations for different balances.

Credit card users likely also would see easier-to-read tables in their monthly statements as a result of the changes.

The new rules, which were proposed earlier this year, are expected to total some 1,000 pages. They need approval of the Federal Reserve, the Office of Thrift Supervision and the National Credit Union Administration, which all are expected to act on Thursday.

Consumer groups say practices of credit card companies blindside consumers and US lawmakers have threatened legislation if regulators did not use their consumer protection powers to reform the industry.

With Democrats streng-thening control of the next Congress that convenes in January and the financial services sector in turmoil, credit card companies that resisted the changes increasingly have accepted them.