The National Small Business Association recently submitted comments to the U.S. Federal Reserve Board (the Fed) in support of the “Unfair or Deceptive Acts or Practices” rule proposed by the Fed, the Office of Thrift Supervision at the U.S. Department of Treasury, and the National Credit Union Administration.

The aggressive new rule, proposed earlier this year, aims to prohibit the most egregiously unfair and deceptive practices of the credit-card industry and would apply to banks, thrifts, and credit unions.
NSBA specifically endorsed the provisions of the rule that would:

• Ensure a reasonable time to make a payment;

• Ensure fair application of payments;

• Restrict increases in APR;

• Restrain unfair over-limit fees;

• Eliminate double-cycle billing; and

• Improve firm offers of credit.


NSBA also urged the Fed to improve the proposed rule by:

• Prohibiting the practice of universal default;

• Limiting the interest-rate percentage increases that card issuers can impose on
holders;

• Prohibiting the ability of card issuers to unilaterally alter the terms of
consumers’ credit-card contracts at “any time for any reason”;

• Prohibiting interest charges on transaction fees; and

• Prohibiting extra interest charges on card debt that the cardholder already paid in
full

The full proposed rule is available here.