Chase Credit Card Changes Policy
November 26, 2007
JP Morgan Chase and Company will no longer increase the credit card interest rates for those individual customers who receive a lower credit score after receiving one of the Chase credit cards.
The change in policy might be seen as Chase getting ahead of expected legislation that is aimed at the credit card companies and what some see as unfair practices. Already the House is looking into ways to legislate consumer protection policy practices that would affect all of the credit card companies. The Federal Reserve is also planning to revamp the disclosure requirements that credit card companies must give to card holders, new and old.
“Chase’s announcement that it will no longer increase interest rates for individual cardholders when their credit-bureau scores decline is an important step that I hope will lead to industry-wide reform,” said Rep. Carolyn Maloney, D-N.Y. She is the current chairman of the House Financial Services Subcommittee on Financial Institutions and Consumer Credit. “The credit card industry should move away from so-called ‘gotcha re-pricing,’ which consumers overwhelmingly find unfair.”
Chase reported that the change, which is effective March 1, is part of a company program designed to better help customers understand and manage their accounts.