These disclosures highlight key account terms and attempt to improve consumers’ understanding of the costs associated with using their cards. The resulting disclosure requirements establish a new baseline for transparency in the credit card industry. In addition, the new rules ban certain practices that increase the cost of credit in ways that cannot easily be disclosed to consumers, such as double-cycle billing.
The new rules also generally prohibit card issuers from increasing interest rates applied to existing balances and require issuers to provide adequate notice of higher rates to be applied to future balances. It is too early to draw conclusions about the ultimate impact of these changes because many of the new requirements have been in effect only since earlier this year.