Credit card legislation finally adopted, a victory or a trouble?

On Tuesday afternoon the US Senate voted 90-5 for the new legislation that imposes strict limitations on fees and practices of credit card issuers nationwide. The bill called the Credit Card Accountability, Responsibility and Disclosure Act (CARD Act) which was originally promoted by Connecticut Senator Chris Dodd will be now considered at the conference where it should be reconciled with the bill previously adopted by the House.

“This is a victory for every American consumer who has ever suffered at the hands of a credit card company,” said Dodd. “My bill that the Senate passed today will insist on consumer protections that are strong and reliable, rules that are transparent and fair, and statements that are clear and informative. I want to thank President Obama for working with me to get this over the finish line, and I urge my colleagues in the House to act quickly to pass this bill so we can get it to his desk as soon as possible.”

Meantime, analysts said the profits of major card issuers such as Citigroup, Bank of America, JPMorgan Chase and Capital One would be hurt by the bill.

American Bankers Association President Edward Yingling said the bill "will undermine the availability of credit" by restricting lenders' ability to price for risk.