Credit Cards: Increased Complexity in Rates and Fees Heightens Need for More Effective Disclosures to Consumers

United States Government Publishing Office publisher pbl distributor dst United States Government Accountability Office author aut Government Organization text government publication eng GAOREPORTS Legislative Agency Publications gao legislative 2010-08-12 U.S. Government Printing Office 2006-09-12 monographic deposited born digital 114 p. GA 1.13:GAO-06-929 https://www.govinfo.gov/app/details/GAOREPORTS-GAO-06-929 P0b002ee180377b02 f:d06929 DGPO 2010-08-12 2011-03-24 GAOREPORTS-GAO-06-929 machine generated eng fdlp REPORT GAOREPORTS-GAO-06-929 GAO-06-929 Bankruptcy Consumer education Consumer protection Credit Credit sales Data collection Debt Federal regulations Fees Fines (penalties) Information disclosure Interest rates Late payments Lending institutions Policy evaluation Statistical data Surveys Other Written Product A60724 Credit Cards: Increased Complexity in Rates and Fees Heightens Need for More Effective Disclosures to Consumers With credit card penalty rates and fees now common, the Federal Reserve has begun efforts to revise disclosures to better inform consumers of these costs. Questions have also been raised about the relationship among penalty charges, consumer bankruptcies, and issuer profits. GAO examined (1) how card fees and other practices have evolved and how cardholders have been affected, (2) how effectively these pricing practices are disclosed to cardholders, (3) the extent to which penalty charges contribute to cardholder bankruptcies, and (4) card issuers' revenues and profitability. Among other things, GAO analyzed disclosures from popular cards; obtained data on rates and fees paid on cardholder accounts from 6 large issuers; employed a usability consultant to analyze and test disclosures; interviewed a sample of consumers selected to represent a range of education and income levels; and analyzed academic and regulatory studies on bankruptcy and card issuer revenues. https://www.govinfo.gov/content/pkg/GAOREPORTS-GAO-06-929/html/GAOREPORTS-GAO-06-929.htm https://www.govinfo.gov/content/pkg/GAOREPORTS-GAO-06-929/pdf/GAOREPORTS-GAO-06-929.pdf GAO-06-929 https://www.govinfo.gov/app/details/GAOREPORTS-GAO-06-929 Other Written Product GAO-06-929; Credit Cards: Increased Complexity in Rates and Fees Heightens Need for More Effective Disclosures to Consumers; Bankruptcy Consumer education Consumer protection Credit Credit sales Data collection Debt Federal regulations Fees Fines (penalties) Information disclosure Interest rates Late payments Lending institutions Policy evaluation Statistical data Surveys