New legislation was introduced yesterday that aims to put a cap on the fees ($15) and interest rates (16%) that credit card companies can charge their customers.
Of course there’s going to be a lot of resistance from credit card companies, but is this really what we need? Wouldn’t an informed consumer be better able to make decisions about when and if to use high interest credit? Is a cap on fees and interest rates just a way to relieve consumers of the burden of actually learning how to properly use credit?
I know before I learned how credit really worked, I was easily lured by low introductory rates and ended up spending more than I should have. Cheap credit may not necessarily be a good thing. It may help some people who are currently paying upwards of 30% or more in interest (if the limits are applied retroactively—which they rarely are), but how would it hurt consumers who up until now, have not been using credit because of the high rates?
Deceptive lending practices and usury aside, what do you think? How far should we go to protect the public from credit card companies’ interest rates and fees?
