New credit card rules welcomed
In news that may be of interest to those seeking to compare credit cards, one financial commentator has welcomed forthcoming rules on lending.
Nicole Rich, director of policy and campaigns for the Consumer Action Law Centre, spoke to the Sydney Morning Herald about the new legislation on credit cards.
Ms Rich said she was pleased that the National Consumer Credit Protection Bill, which is to be passed this year, will help to ensure people do not get into too much credit card debt.
She argued unsolicited offers to increase credit limits are intended to encourage debt so that lenders can make a profit from the interest.
Meanwhile, Todd Beavis, a spokesperson for American Express, explained lenders will only offer higher limits if credit card holders have demonstrated they can manage their finances.
"An offer is only ever made following an assessment of the card member’s ability to meet the higher limit, as it’s not in their interest, nor ours, for a card member to get into financial difficulties," he commented.
The new regulations will be rolled out over the next 18 months, to come into full force in 2011.
Lenders will be required to register with the Australian Securities and Investments Commission and adhere to responsible lending conduct requirements.
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