Low Interest Credit Cards

This past year has been one of the most turbulent years in the history of the credit card industry for both issuers and cardholders. Issuers made substantial changes in their rates and fees to increase revenue. This created higher payments for consumers during a time of recession and high unemployment.

This week, comScore released its Online Credit Card Report: 2009 Edition. The study shows that half of consumers have noticed changes in their account made by their issuer including higher interest rates, lower credit limits and additional fees. The study also reports that over two-thirds of consumers have responded to changes in their credit card terms and conditions by closing the account, switching to another card or lowering their spending behavior.

Credit card issuers claim they had to increase rates and fees as well as reduce their lending risks in order to stay in business.

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For all those individuals who have used their credit wisely and kept up with making their payments on time, you would think that credit card issuers would be more apt to reward their customers with lower rates, better terms and more attractive features. Instead, it appears that card issuers are finding loopholes before the new law takes effect to fill the gap.

Credit card issuers have leveraged the use of frequent flyer miles programs, cash-back rewards and other perks to entice customers into using their card products.  The new legislation will limit the ability of card issuers to make those easy, high interest rate card offers to riskier or less than qualified borrowers.  Making up the short-fall, it appears, will come from a notable source …. the

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