Credit card crackdown too late?

Getting away from credit card fraud for a minute, at least the illegal type, we have some pending regulations that are good and bad, compliments of the Office of Thrift Supervision, the Federal Reserve, and the National Credit Union Administration.

The good news is that new regulations will clamp down on some of the deceptive practices of card issuers. No longer will they be able to retroactively increase rates on existing balances unless the cardholder is making payments over 30 days late. No longer will they be able to apply payments just to lower teaser rates and balance transfers while the higher rate balances are not credited. There are a lot of other smaller regulations there too, all designed to protect cardholders. THe deceptive practices that will be eliminated are estimated to add almost $12 Billion to the card companies’ bottom line every year.

The bad news. These rules will not go into effect until July of 2010. That gives the card companies 18 months to raise their rates under current regulations in order to make up that $12 billion loss. Do you think they won’t do that?