WASHINGTON (Reuters) - President Barack Obama will sign wide-ranging, pro-consumer credit card reforms into law by late May, senior U.S. House Democrat Carolyn Maloney predicted on Wednesday.
“President Obama seems very determined,” Maloney, who met with Obama on Tuesday at the White House, told the Reuters Global Financial Regulation Summit in Washington. “He said, ‘We’re going to get that bill. We’re going to enact it into law’.”
Maloney, who chairs Congress’ Joint Economic Committee, added: “I‘m predicting by Memorial Day (May 25) we will have... a law.”
The House of Representatives is expected to vote Thursday on Maloney’s bill, dubbed the “Credit Cardholders’ Bill of Rights.”
Democrats, on behalf of the Obama administration, are expected to introduce a set of amendments including requiring card issuers to maintain low introductory teaser rates on credit cards for at least six months, and to warn card holders if they are about to exceed their credit limits, allowing them to avoid a penalty fee.
Maloney, who failed during a recent bill-writing session to insert a requirement for issuers to implement changes within 90 days of the bill becoming law, said another Democratic lawmaker will re-propose that provision for the House bill.
The Senate Banking Committee last month narrowly backed its own legislation. Senate Majority Leader Harry Reid said he plans to bring a bill to the floor for a vote sometime “in this work period,” before the Memorial Day break.
In 2007, Americans used an estimated 694.4 million credit cards with Visa Inc (V.N), MasterCard Inc (MA.N), American Express Co (AXP.N) and Discover Financial Services (DFS.N) logos, according to industry data.
Treasury Secretary Timothy Geithner, who met with Maloney on Wednesday, said he supports the congressional measures.
“We need to change the rules of the game so that consumers are not caught by deceptively complex rules,” Geithner said, adding that he saw support for reform in Congress as a “very strong signal of commitment to progress” on the Obama administration’s financial reform agenda.
The Federal Reserve and other banking regulators last year approved rules against unfair and deceptive credit card practices but gave the industry until July 2010 to comply.
Lawmakers want to codify those rules into law and go even further, frustrated with surprise interest rate hikes and hidden fees from card issuers -- many of which have received billions of dollars in bailout funds aimed at boosting lending.
Banks complain that the changes could hurt their revenues at a time when they can least afford it and could actually reduce the availability of credit.
The head of the American Bankers Association, which represents the biggest credit card issuers, told the Reuters summit on Tuesday that he expects a final credit card bill “in the not too distant future.”