Credit card satisfaction hits new low.

September 9, 2009 9:54 am

Okay, so that headline packs all the shock value of "Sun Rises in the East." But given the widespread annoyance so many readers have with their credit card issuers (check out comments to blog posts here and here) I thought it might be, well, satisfying to know card wrath is a bit of a national epidemic.

J.D. Power reports that overall customer satisfaction with credit card issuers hit a three-year low, clocking in at 703 (on a scale of 1000) in 2009. That was slightly lower than the already anemic 710 score from 2008, and is the lowest showing since the firm started looking at credit cards in 2007.

On the sub-topic of fees and rates, the 2009 satisfaction score slumped from a solid D (640 in 2008) to a D-minus (603 in 2009) as the percentage of respondents who were hit with an interest rate increase nearly doubled over the past year, to close to 20%. Customers reporting complaints/problems also shot up; from 10% in 2008 to 18% this year.

No surprise then, that J.D. Power says credit card issuers own the dubious distinction of having the lowest satisfaction score across the financial services industry, trailing investment services, insurance and banking.

Those of you who’ve reached your annoyance limit with a current card issuer might want to check out the two most satisfying card firms in this year’s survey: American Express (762) and and Discover (751).

Or you can hold on in the hope that the impending new consumer-friendly regs scheduled to go into effect in February 2010 will help matters. I’m not holding my breath. Industry analyst firm R.K. Hammer estimates that credit card issuers will pocket about $20 billion in credit card fees this year. Something tells me they will come up with new and unsatisfying ways to keep that gravy train running in 2010 and beyond.

New Credit Card Laws for 2010

President Obama recently signed the Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009. Most of this new legislation will begin February 22, 2010.

Some of the highlights of the Bill are:

Interest rate increase protection-
Unless the payment on your account is over 60 days late, an interest rate can no longer be raised. If you are late in paying and the rate is raised, after 6 consecutive on time payments, the increased rate will have to be restored to its previous rate. The interest rate cannot be increased within the first year (12 months) however and the promotional rates have to last for a minimum of 6 months.

Advanced notice of term changes-
The credit card companies now have to let cardholders know at least 45 days in advance if any significant changes (changes to benefits, rewards programs, rates, etc.) will take place to their card.

Limiting credit card use of young adults-
Credit cards will now be banned for people under the age of 21 unless there is an adult co-signer, or good proof that they have the appropriate funds and means to pay off the debt incurred. Also, once a card is obtained by a young adult (under 21), college students will be required to get permission from parents or guardians in order to increase the limits on the joint accounts held by them.

Hidden fees on gift cards-
Gift cards will now be required to stay activated for at least 5 years once activated initially. No longer will dormancy fees be implemented, unless there has been no activity within a 12 month period. If the company does have a dormancy fee though, it must be clearly disclosed to the buyers of the gift cards.

Notification of bill and payment processing-
Credit card companies must have the bills sent out at least 21 days (3 weeks) before the payment is due. If the payment is received by 5 p.m. on the date that it is due, it must be deemed on-time.

CSCS Research and Posted: by: Marilyn Evans of Fuen -- University Housing Gpt Ms,

creditcardprocessor.wordpress.com/.../

Credit card rates: Nowhere to go but up

New law will rein in many practices long decried by consumer activists. What it won't do is keep interest rates, now at a low point, from rising.

http://money.cnn.com/2009/12/02/news/economy/credit_card_rates/index.htm

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